Annual Report 2016
Year Ended March 31, 2016

IBIDEN Worldwide—IBI-TECHNO without Borders

Global Network
ProfileIBIDEN was established in 1912 as an electric power company to bring growth to theEuroperegional economy. Ever since then, we at IBIDEN have pioneered new business
operations and continued to grow by fusing and combining our own innovative coretechnologies to create new technologies. At present, we are rolling out operations andsteadily expanding our record of performance on a global scale, centering on electronics
and ceramics products.
To celebrate the 100th anniversary of the Company’s foundation, IBIDEN renewed its
corporate philosophy, IBIDEN WAY, and brand logo mark in November 2012. The renewed
IBIDEN WAY and logo embody our commitments that; every one of our employees will
work with integrity and respects for the harmony with others. We also will practice thecorporate values by courageously meeting challenges given by the changing time, andrealize the sustainable development of “IBI-TECHNO”—our unique technologies andvalues into the future.
For all stakeholders, we aim to strengthen responsible corporate management andbecome a corporate group that enjoys sustained growth.
● Electronic Substrate● Ceramic● Sales and Others

Contents
Business Snapshot...............................02

At a Glance...........................................12

Business Concept/Corporate Strategy....04

Review of Operations............................14

Five-Year Consolidated Financial
Summary..............................................06

Research and Development..................17

Message from the President.................08

Corporate Governance..........................19

Management Discussion and Analysis....10

Capital Expenditures.............................18

Board of Directors, Auditors andExecutive Officers.................................22
CSR Management.................................24
Financial Section..................................26
Group Companies.................................51
Corporate Information...........................52

Forward-Looking Statements
Forward-looking statements made in this annual report concerning performance or business strategies have been determined according toassumptions and beliefs based on information available at the time of publication and may contain elements of risk and uncertainty.

Other 0.0%
Europe 21.0%

North America 5.3%
Net Sales
Composition
by Region

Japan 26.1%

2016

Asia 46.6%

North
America

Asia

Japan

01

Other

Note: Net sales are classified by country or region based on the customer’s location.

Net Sales by Region(Millions of Yen)

300,000

200,000

100,000

0

2012
JAPAN

2013
ASIA

NORTH AMERICA

2014
EUROPE

2015
OTHER

2016

Business Snapshot

Toward the Establishment of a Third Source of Revenue
The Group has responded flexibly to changes in the business environment and developed a further
collaborative relationship among the Group companies since the fiscal year ended March 31, 2016. To speed
up the synergy effect, we have made changes in the business segments on the right. Under the new businesssegments, we have positioned the Other Operation as a third source of revenue following the Electronics
Operation and the Ceramics Operation, and sought to enhance competitiveness. Major businesses in the
Other Operation are introduced below.

Housing Materials Business

02

In April 2016, IBIKEN Co., Ltd. merged with IBIDEN KENSO Co., Ltd. In
the coming years, IBIKEN Co., Ltd. will strive to grow its operations withdifferentiated products such as unique component housing and antiviralmelamine decorative laminate. Particularly promising are new products,
including antiviral melamine decorative laminate IBI-BOARD Viruhael andantiviral melamine noncombustible decorative laminate Retect Viruhael,on which a photo-catalyst substance is attached to a laminate using aunique technology, reducing viruses by 99% or more in the process.
These products, which are optimal for public buildings, such as hospitals,
schools, and nursing care facilities, which have strong needs for antimass infection measures, have already been introduced to the toilets
of a large sports stadium. IBIKEN is also developing and marketing forsale housing as witnessed by the development of Local Village Ogaki, a
residential area based on the concept of “Working in an Urban Area and
Living in Nature.”
IBIKEN Co., Ltd.

Established April 1, 2016

Capital ¥96 million

Retect Viruhael: high pressure
laminates with antiviral effect/
wall surface, Monde Booth/toilet
booth, Stylish Counter/counter

Retect: noncombustible laminates/
kitchen counter
IBI TICO: high pressure laminates/cabinet doors

Local Village Ogaki

Construction Business
IBIDEN Greentec Co., Ltd. (“IBIDEN Greentec”), an operator primarily
engaged in the construction business, provides garden and slope
construction services across the country. In the garden construction
business, the company specializes in wall and rooftop greening, a typeof greening that is thought to be difficult using conventional methods andrequires sophisticated expertise. This type of greening is regarded as ahighly effective means of reducing the heat island phenomenon, savingenergy, and improving a landscape, which are pressing challenges forurban areas. In October 2015, in recognition of its determined efforts andexcellent results, IBIDEN Greentec was honored with the Minister of theEnvironment Award in the rooftop greening category of the 14th Roof,
Walls, Special Greening Technology Competition. In the slope construction
business, the company pursues operations on the strength of its patented
GT Frame Construction Method, designed for disaster prevention andenvironment preservation, which are present-day challenges.

Roof greenification
system(Photo: NODAI Academia
Center, Tokyo Universityof Agriculture)

Wall greenification system(Photo: Toyosu Foresia)
Approximately 44% of the site area iscovered with greenery

2015

2016

Electronics Operation

Electronics Operation

Ceramics Operation
Ceramics Operation

Housing Materials Operation
Construction Operation

Other Operation

Other Operation

Power Generation Business
The Company has been conducting hydroelectric power generation
since its foundation, and currently operates three hydroelectric
power plants upstream on the Ibi River. During the fiscal year underreview, with the completion of renovation work at the HigashiYokoyama Power Plant, all of our power plants became compliant
with renewable energy feed in tariffs (FIT), ensuring stable, long-term
revenue. We also constructed Japan’s largest floating solar power
generation plant, located at the lumberyard parking site of IBIDEN’s
Kinuura Plant. The new plant is expected to reach an annual output
of approximately 2,400 MWh, with all the electricity generated
sold to the power company. The water floatation devices use theCompany’s developed lightweight, corrosion-resistant and highdensity polyethylene (patent pending), a promising product for theCompany’s business.

03

The Japan’s largest
water floating solar
power generation

Higashi-Yokoyama Power Plant

A war d T opics

Awarded the 15th SCQI by Intel Corporation: Electronics Operation (PKG)

Award

IBIDEN was awarded the Supplier Continuance Quality Improvement (SCQI) Award byIntel Corporation for the second consecutive year. This award was granted to IBIDEN
for achieving remarkable results in terms of Intel targets and for being deemed tohave fulfilled a role as an important leader within the industry in terms of all important
items evaluated by quality, cost, supply frameworks, technological prowess,customer service, labor, ethics systems as well as environmental sustainability.

Received the Daimler AG’s Supplier Award: Ceramics Operation (DPF)
Daimler AG has honored its suppliers that have achieved collaboration backed by acertain level of performance and partnership. In the “Global Procurement Trucks andBuses” innovation category, the award was granted to our Ceramics Operation for
its highly evaluated development of state-of-the-art diesel particulate filters (DPF) andproduction engineering for high-end trucks.

Award

Business Concept/Corporate Strategy

Corporate Philosophy: IBIDEN WAY
The power that has enabled IBIDEN to overcome many

carries this on, transcending borders, is the “IBIDEN WAY.”

adversities with all our employees and to continue to operate,

To mark its 100th anniversary, we have revamped

and the wisdom and vitality that have achieved dramatic

our corporate philosophy, the “IBIDEN WAY,” simplifying

growth in recent years—these have persisted throughout

it to enhance its understanding by all IBIDEN GroupIBIDEN’s long history of 97 years. The systematization that

employees worldwide.

04

SPIRIT
We share our spirits with all staffs globally. And through accomplishing these,"Corporate Philosophy" will be realized.

Trust throughIntegrity

Gaining customer andsocietal trust through“Genchi Genbutsu*”*Genchi Genbutsu: Go and
See for yourself to thoroughly
understand the situation“Wa”
Teamwork andSynergy

Integrating knowledge
and wisdom from theemployee involvement
for greater power.

Challenge with
PassionIBI-TECHNO
Innovation

Anticipating change,
and acting boldly tocreate new value.

Evolving by
overcoming hurdles
through creativity andingenuity.

“Challenge IBI-TECHNO 105 Plan”
We reinforce our capacities for total productive management, management of technology,
management of business, and management capability in order to establish a robust corporate culture resilient to any market changes.

Today’s business environment surrounding IBIDEN Group is extremely volatile, faced by the fierce competition between companies seeking global survival.
In April 2013, we launched our consolidated medium-term management plan, “Challenge IBI-TECHNO
105 Plan,” envisioning next 100 years ahead of us. By redefining and strengthening our total productive
management, management of technology, management of business and management capability, we willsolidify and restructure our core business competitiveness. By emphasizing the global implementation of
TPM activities, we boost our onsite capabilities, while at the same time engaging in the creation of innovative technologies in the fields of materials, facilities, and production processes.
Also, based on our core technologies nurtured through the company’s distinguished history, we will set
up specific goals and engage ourselves in the development of new electronic and ceramic products, aswell as product development and business implementation in new business areas.
Furthermore, in our effort to successfully run our CSR management, we put our emphasis on “humanresource management” to nurture people who can thrive globally.
Through the steady implementation of the consolidated medium-term management plan, we willfurther reinforce our revenue base, and everyone in the Group will actively take up new challenges torealize a new level of growth.

Consolidated medium-term management plan

“Challenge IBI-TECHNO 105 Plan”
PeriodFY2013 to FY2017【5 year term】
Pillar of the strategy
1. Reconstruct and enhance competitiveness of core operations
2. Work on the creation of new business3. Develop and promote CSR management globally05

Five-Year Consolidated Financial Summary

IBIDEN CO., LTD. and Consolidated Subsidiaries
For the years ended March 31, 2016, 2015, 2014, 2013, and 2012
Thousands of
U.S. dollars (Note)

Millions of yen

For the year:
Net sales

2016
¥

2015

314,119¥2014

318,072¥

310,2682013¥

285,947

2016

2012
¥

300,864$

2,789,195

Operating income			

22,571

26,03923,442

5,420

15,516200,414

Profit before income taxes 			12,12929,60425,484

7,356

15,258

107,699

Profit attributable to owners of parent		

7,531

19,107

17,4792,232

10,64866,870Comprehensive (loss) income			(14,236)

42,042

40,72422,885

9,489(126,405)

EBITDA			

66,62865,46759,144

48,11857,903591,614

Capital expenditures 			

40,95556,35037,731

43,26247,313363,660

Depreciation and amortization			

44,05739,42835,702

42,69842,387391,200

Research and development cost 			

15,204

15,512

15,031

15,125

16,123

134,997

Net cash provided by operating activities			

59,49961,54750,09345,10137,371

528,319

Net cash used in investing activities			

(39,439)(54,888)(38,364)(58,325)(59,292)(350,193)

Net cash (used in) provided byfinancing activities			

(20,479)

9,835(6,935)(11,508)

34,092(181,846)

Free cash flow			

20,0606,659

11,729(13,224)(21,921)

178,126

06
At year-end:
Total assets¥

476,110¥

519,847¥

462,113¥430,040¥

425,871$

4,227,583

Total net assets

331,521360,092

322,562

286,705

274,900

2,943,713

Interest-bearing debt

70,12875,85561,574

63,92563,738622,696

Cash and cash equivalents

107,875

110,479

91,67982,970104,487

957,871

150,860,557

150,860,557

150,860,557

150,860,557

150,860,557

Total number of shares issued (shares)

Per share data:
Basic profit attributable to owners of parent

U.S. Dollars(Note)

Yen

¥

55.29

¥138.37¥

126.58

¥

15.97

¥

74.41

$

0.49

Diluted profit attributable to owners of parent		——126.15

15.86

73.69

—

Net assets 		

2,459.63

2,578.85

2,305.93

2,043.29

1,885.53

21.84%

Ratios:		 Equity ratio		

68.75%

68.50%

68.91%

65.61%

63.35%				 ROE		

2.20

5.67

5.82

0.81

3.97		

		 ROA		

1.51

3.89

3.92

0.52

2.59		

		 Price earnings ratio (times)		

24.89

14.65

16.07

91.78

28.45

Notes: 1. U.S. dollar amounts have been converted for convenience only at the rate of ¥112.62=US$1, the rate of exchange on March 31, 2016.
2. EBITDA = Operating income + Depreciation and amortization

Net Sales

Operating Income/Operating Income Ratio(Millions of Yen)

(Millions of Yen)(%)

28,00020

21,00015

14,00010

300,000

Profit Attributable to Owners of Parent(Millions of Yen)

25,00020,000200,000

15,00010,000100,000

7,000

0

5

0

12

13

14

15

0

16

12

13

14

15

5,000
0

12

16

13

14

15

16

Operating Income Ratio

Capital Expenditures/
Depreciation and Amortization

Research and Development Cost

Free Cash Flow

(Millions of Yen)

(Millions of Yen)

(Millions of Yen)

70,00016,00030,00060,00014,00020,00007

12,00050,00010,00010,00040,0000

8,000

30,0006,000

20,0004,000

10,0002,000–10,000–20,000–30,000

0

0

12

13

14

15

12

16

13

14

15

16

12

13

14

15

16

Capital Expenditures
Depreciation and Amortization

Interest-Bearing Debt

Total Net Assets/
ROE(Millions of Yen)

(Millions of Yen)(%)

70,000350,000

14

60,000300,000

12

50,000250,000

10

40,000200,000

8

30,000150,000

6

20,000100,000

4

10,00050,0002

0Total Assets/
ROA

0

12

13

14

15

0

12

16
ROE

13

14

15

16

(Millions of Yen)(%)

500,000

10

400,000

8

300,000

6

200,000

4

100,000

2
0

0

12
ROA

13

14

15

16

Message from the President

Hiroki Takenaka
President & CEO

Direction of Our Business Management

Striving to build a corporate culture to grow our business continuously under the consolidated medium-term management plan
“Challenge IBI-TECHNO 105 Plan”

08

The fiscal year ended March 31, 2016 marked the halfway point ofour consolidated medium-term management plan, “Challenge
IBI-TECHNO 105,” for the five years started from April 2013. The
main focus of our medium-term management plan is to create a
corporate culture that enables us to stay ahead of changes in thebusiness environment and continue to grow our businesses over the
next 100 years and beyond. As a global supplier, we deliver components to the world’s leading manufacturers. While doing so demands
world-beating quality and expertise, we have continued to meet all of
our customers’ requirements and deliver results exceeding expectations, thereby achieving greater customer satisfaction and growing
the Company. A source of growth lies in bolstering such manufacturing activity and developing human resources while continuing
innovations, which is the essence of our business. These efforts,
referred to as IBI-TECHNO innovations, are the foundation of ourbusiness operations. As a specific initiative of IBI-TECHNO innovations under the medium-term management plan, we engage inunique improvement activities, focusing on the “5S,” “Jikoutei
kanketsu (built-in quality with ownership) activities,” and “crosssectional teamwork activities” based on “Genchi (actual site),
Genbutsu (actual thing), and Jigakari (on-site solution of problem).” By
proactively solving problems on-site by exercising their creativity, allemployees are able to improve their skills and increase their motivation towards work, thus developing human resources. In addition

to achieving management goals, we take on the challenges ofattaining higher goals by instilling a sense of achievement in
employees, while improving teamwork. Through these activities,
we aim to promote a positive “spiral up” effect. (See Fig. 1“Business Model”)
In the medium-term management plan, to respond flexibly to achanging operating environment, we facilitate activities that increase
the competitiveness of our businesses with the aim of creating astable earnings structure consisting of three business segments:
Electronics Operation, Ceramics Operation, and Other Operation.
Business Results for the Fiscal Year Ended March 31, 2016The Other Operation has raised its profile as a third source ofrevenue amid a generally challenging operating environment
We have facilitated the restructuring of our Electronics Operation in
response to the recent expansion of the smartphone and tablet device
markets, as well as the shrinking of the PCs market. As part of theeffort, we have enhanced our unique technological capabilities andimproved production efficiency by integrating package substrate operations for PCs, a small-sized thin substrate operation for smartphones
and tablet-type devices, and a printed wiring board (PWB) operation
for smartphones and tablet-type devices. However, the businessresults of the Electronics Operation were very severe due to the further
shrinking of the PC market, coupled with a clear slowdown of thehigh-end smartphone market since the second half of the fiscal year.

Fig. 1 Business Model
IBIDEN Group
Business Concept: As a global supplier, we expand businesses globally focused onelectronics and ceramics components by leveraging our innovative technologies and highresponse capabilities to customer needs.

The world’s highest levelof technical requests, needs,
and quality standards

Three strengths:• Technologies• Proposal capability• Response capability

Management Base: The IBIDEN Management System has been established to continuously
improve our competitiveness and customer satisfaction, into which all of our existing management
systems covering quality (ISO 9001), environment (ISO 14001), and occupational health andsafety (OHSAS 18001) have been integrated.
Source of Technologies: IBI-TECHNO Innovation includes the methods of Genchi, Genbutsu,
and Jigakari, 5S, jikotei kanketsu activities, and cross-sectional teamwork activities.

Genchi: Actual places where issues are arising.
Genbutsu: Matters relevant to the issues. “Genchi Genbutsu” means “go to an actual
place and see actual things for yourself to make sure of the fact.”
Jigakari: In-house activities to deal with problems by yourself and find out the root
cause for the solutions.
5S:
Five S represents “Seiri (sorting), Seiton (setting in order), Seiso (cleaning),
Seiketsu (standardization), and Shitsuke (discipline).”World-leading
manufacturers of• Semiconductors• Electronics• Automobiles, etc.

Unrivaled products that
overwhelmingly stand out intechnical capabilities

Corporate culture produces a technical breakthrough through human resource development
Notes:

Clients+ Spiral of growth → True competitive advantages

Jikotei kanketsu :Consider the next process as your customer, and build
up quality of work with a sense of ownership to meet thecustomers’ needs and satisfaction.
Cross-sectional teamwork: Team work activities by the members from different sections
to achieve the same objective under common understanding
between organizations.

In the Ceramics Operation, as part of our major diesel particulate
filter (DPF) business, we started mass production at IBIDEN Mexico Co.,
Ltd. in June 2015, which is a new production base for DPF used inlarge vehicles where market expansion is expected in line with the future
implementation of more stringent exhaust emission regulations. As aresult, we have completed development of a global production framework including Japan and Europe. In addition, we have also facilitateddevelopment of a framework that improves our capabilities to propose
solutions to customers by leveraging synergies with the AFP and SCR
businesses. Although overall sales of the Ceramics Operation remainedsolid, backed by a robust auto market, operating income declined due
to changes in the product mix, impacts of a fall in sales prices, and thecosts of launching IBIDEN Mexico Co., Ltd.
In the Other Operation, we merged IBIKEN Co., Ltd. and IBIDENKENSO Co., Ltd., two of our group companies in Japan, with the aimof further strengthening our housing materials business. Goingforward, we will strive to expand our businesses by leveraging products with distinguished features, such as our unique component
housing and antiviral melamine decorative laminates. With thecompletion of renovation work at the Higashi-Yokoyama Power Plant,
all of our power plants have become compliant with renewableenergy feed in tariffs (FIT). We will continue to solidify the position of
the Other Operation as a third source of revenue by expanding businesses with distinguished products and long-term stable earnings
through the power business.

high-end products; 2) expand target segments to include mid-range
items using technological expertise developed for high-end products;3) broaden interfaces with fast-growing customers such as Chinese
manufacturers; and, 4) increase uses of technologies, targeting new
fast-growing IoT and in-car product segments, in addition to theserver module field. (See Fig. 2 “Strategies for Electronics Operation)
The Ceramics Business is likely to see demand grow in the mediumto long-term, driven mainly by large vehicles and construction
equipment, as European countries are scheduled to further tighten
gas emissions regulations in the coming years. Although the cost oflaunching the new IBIDEN Mexico plant, in which an advance investment was made, has been weighing heavily on our profits, the plant’s
completion marks the conclusion of IBIDEN’s initiative to establish a
global production framework, allowing the Company to enter a stage
where it will recover its investment. In the Other Operation, we will
expand business operations with characteristic new products incollaboration with the technology development side, having the division attain a higher profile as a third source of revenue.
The business environment surrounding us is expected to remain
highly challenging and uncertain. However, guided by our medium-term
management plan, we will make every effort to strengthen our truecompetitiveness and overcome a challenging situation, restoring our business performance by the fiscal year ending March 31, 2018, the final yearof our medium-term management plan. We will strive to put our businessback onto a sustainable growth path towards the next 100 years.

Outlook for the Fiscal Year Ending March 31, 2017

Shareholder Returns

Riding out the crisis, while striving to achieve an earnings recovery
in the fiscal year ending March 31, 2018 with all employees working
as one team to truly enhance competitivenessConducted treasury stock acquisition and share retirement todeliver increased shareholder value

During the fiscal year ending March 31, 2017, a continued
shrinking of the PCs market and a further slowdown in the highend smartphone market are forecast in the Electronics Operation.
In addition, the launch of fan-out wafer-level packaging (FO-WLP)
is expected to significantly impact our CSP business. As a result, a
year-on-year decline of about 20% is forecast for the sales of theElectronics Operation.
By leveraging the superiority of our business model as a global
supplier, we will strive to achieve a recovery in order intake throughefforts to: 1) continue to capture business in cutting-edge fields for09

With respect to the year-end dividend for the fiscal year ended
March 31, 2016, we have decided to pay ¥20, which is unchanged
from the previous fiscal year. As a result, the annual dividend
including the interim dividend will be ¥35 per share, which isunchanged from the previous fiscal year. In addition, to implement
a flexible capital policy in response to changes in the businessenvironment aimed at increasing shareholder value, we acquired
5,000,000 shares of treasury stock and retired 10,000,000 sharesof treasury stock in the fiscal year ended March 31, 2016.
We thank you for your continued support and understanding of
the Group.

Fig. 2 Strategies on Electronics Operation
Existing target
product
marketHigh-end
marketMiddle-end
marketLow-end market

Expansion oftarget product market

Expansion ofclient segment

Expansion of
product applications

Cultivate new customers
such as fast-growing
Chinese makers

Expand applications forfrom server modules tothe Internet of Things
for automotive

Continuously target
cutting-edge areas

Expand the target scopefrom the high-end to
middle-end market(FY2016 to FY2017: up 20%)

Management Discussion and Analysis
Results for the Year Ended March 31, 201610

During the fiscal year under review, the world economy
remained on a modest recovery on the whole, supported by
the strong U.S. economy and the recovering European
economy. However, there was growing uncertainty about theoutlook for the future, due partly to the intensification ofterrorism and regional conflicts, and the economic slowdown in
China and other emerging countries. The Japanese economy
continued on a gradual recovery path in general, reflecting an
improvement in the employment environment and corporate
earnings despite a flat trend in consumer spending.
In the semiconductor and the electronic components
industry, smartphones and tablet-type devices experienced aslowdown in overall market growth reflecting market
maturation in China, which had been leading the market
growth, and a market slowdown in other emerging countries.
In the PC market, sales remained below year-on-year levels.
Accordingly, the Electronics Operation continued to face anintensely challenging business environment.
In the automotive exhaust system components industry,
automotive sales remained brisk around the world, as theEuropean and North American markets continued to growgradually due to the economic recovery and weaker crude oil price.
Given this situation, to stay ahead of changes in thebusiness environment, the Group has been establishing astable earnings structure consisting of three businesssegments: the Electronics Operation, the Ceramics Operation,and the Other Operation, which integrates the powerbusiness and related businesses under the medium-term
management plan. In the Electronics Operation, we haveboosted our competitiveness through combined technologies
and products by integrating the package substrate operationand printed wiring board (PWB) operation. In the Ceramics
Operation, we began full-fledged production in June 2015 at
IBIDEN Mexico S.A. de C.V., comprising a new production
base for diesel particulate filters (DPF) for large vehicles. In
addition, to ensure the contribution to medium- to long-term

stable earnings, we proceeded and completed renovation
work at the Higashi-Yokoyama Power Plant as scheduled to
become compliant with renewable energy feed-in tariffs.
As a result, consolidated net sales amounted to ¥314,119
million, a decrease of ¥3,953 million (1.2%). Operating income
totaled ¥22,571 million, down ¥3,468 million (13.3%), andprofit attributable to owners of parent for the period stood at¥7,531 million, down ¥11,576 million (60.6%).

Analysis of Our Financial Condition and Business
Performance
Analysis of Our Financial Condition(1) Assets
Total assets at the year-end amounted to ¥476,110 million, down
8.4%, year on year. Current assets decreased 3.7% to ¥213,612
million, and fixed assets declined 11.9% to ¥262,498 million.
The significant contributing component in current assets
was decreases of ¥2,076 million in trade notes and accounts
receivable and ¥1,997 million in short-term investments.
The major factors in fixed assets were declines of ¥20,226
million in property, plant and equipment and ¥13,226 million in
investment securities.
(2) Liabilities and Net Assets
Total liabilities at the year-end amounted to ¥144,589 million,
declining 9.5%, year on year. Current liabilities increased
15.9% to ¥113,744 million, and long-term liabilities fell 49.9%
to ¥30,845 million.
Major factors attributable to the rise in current liabilities included
an increase of ¥15,000 million in the current portion of bonds.
The decline in long-term liabilities reflected mainly adecrease of ¥25,127 million in long-term debt including¥15,000 million in corporate bonds.
Total net assets at the year-end amounted to ¥331,521
million, declining 7.9%, year on year. The decrease wasmainly due to such factors as a fall in retained earnings, adecline in net unrealized holding gain on other securities and a

Net Sales

Total Net Assets/
ROE(Millions of Yen)

(Millions of Yen)(%)

350,000

14

300,000

12

250,000

10

200,000

8

150,000

6

100,000

4

50,0002

300,000

200,000

100,000

Total Assets/
ROA

0

0

12

13

14

15

0

12

16
ROE

13

14

15

(Millions of Yen)(%)

500,000

10

400,000

8

300,000

6

200,000

4

100,000

2
0

0

16

12
ROA

13

14

15

16

decrease in translation adjustments. For further details
regarding increases/decreases, please refer to “Consolidated
Statement of Changes in Net Assets.”
As a result of the above, the equity ratio at the year-end
increased to 68.8% from 68.5% a year ago. Net assets per
share fell to ¥2,459.63 from ¥2,578.85.

¥238 million versus ¥158 million in the previous fiscal year.
(5) Profit Attributable to Owners of Parent
Profit attributable to owners of parent for this period was
down 60.6% from the previous fiscal year to ¥7,531 million.
Profit attributable to owners of parent per share for this period
was ¥55.29 versus ¥138.37 in the previous fiscal year. Returnon equity (ROE) was 2.2%, down 3.5 percentage points.

Analysis of Our Business Performance(1) Net Sales and Operating Income
Please see “Review of Operations” on pages 14 through 16
for the general status of net sales and segment income for thebusiness segments.
Cost of sales rose 0.5% from the same period in theprevious year, to ¥238,346 million due mainly to an increase indepreciation and amortization. The cost-to-sales ratio increasedby 1.3 percentage points to 75.9%.

Cash Flow Conditions
Cash and cash equivalents (hereafter “cash”) at the end of the
fiscal year under review amounted to ¥107,875 million, down
¥2,604 million over the previous fiscal year end. The following
is a summary of cash flow activities.
(1) Cash Flow from Operating Activities
Net cash provided by operating activities totaled ¥59,499
million, compared with ¥61,547 million in the previous fiscal
year. This was primarily attributable to increases of ¥12,129
million in profit before income taxes and ¥44,057 million in
depreciation and amortization as well as a decrease of¥11,892 in income taxes paid.

(2) Other Income (Expenses)
In the category of other income and expenses, the Company
posted other expenses of ¥11,309 million (net) for the fiscal
year under review compared to other income of ¥2,745 million
reported one year earlier. The major factors behind thedecrease were ¥1,099 million in a foreign exchange gain
compared to ¥5,769 million in the previous fiscal year and¥6,403 million in loss on impairment of fixed assets comparedto ¥832 million in the previous fiscal year.
As a result, profit before income taxes fell 59.0% to¥12,129 million.

(2) Cash Flow from Investing Activities
Net cash used in investing activities totaled ¥39,439 million,
compared with ¥54,888 million in the previous fiscal year.
Contributing factors included payment of ¥42,747 million forpurchases of property and equipment.

(3) Income Taxes and Others (Including Adjustments for
Income Tax and Others)
Income taxes decreased from ¥10,339 million in the previous
fiscal year to ¥4,360 million in the fiscal year under review.
Consequently, profit declined 59.7% to ¥7,768 million.

(3) Cash Flow from Financing Activities
Net cash used in financing activities totaled ¥20,479 million,
compared with ¥9,835 million in net cash provided during theprevious fiscal year. This change reflected decreases of¥3,127 million in repayment of long-term debt, ¥9,483 inpurchases of treasury stock and ¥4,833 million in cash
dividends paid.

(4) Profit Attributable to Noncontrolling Interests
Profit attributable to noncontrolling interests amounted toInterest-Bearing Debt

Operating Income/Operating Income Ratio

Profit Attributable to Owners of Parent(Millions of Yen)

(Millions of Yen)(%)

28,00020

21,00015

14,00010

70,00060,000(Millions of Yen)

25,00020,00050,00015,00040,00030,00010,00020,0007,000

510,000
0

0

12

13

14

15

16

0

12

13

14

Operating Income Ratio

15

16

5,000
0

12

13

14

15

16

11

At a Glance

Net Sales and Net Sales Composition

Overview

Electronics Operation¥147,872 million

47.1%

Matching today’s high speed of technical innovation, our electronics
technology continues to develop new products at the cutting edge of theworld electronics field. Our built-up substrates for high-density circuits aswell as electronic components and plastic packages for a range ofsemiconductors are the materialization of our IBI-TECHNO philosophy.

Ceramics Operation
12¥104,768 million

33.4%

Over the years, we have developed technologies in essential materials
such as carbide and ferrosilicon. In line with our IBI-TECHNO philosophy,
we have emerged as a leading developer of advanced ceramics including
environment-related ceramics products, (such as SiC-DPF and substrateholding mats), graphite specialty products, ceramics fibers, and fineceramics products.

Other Operation¥61,479 million

19.5%

This segment comprises the housing materials business, construction
business and other businesses with unique operations, respectively. In the
housing materials business, centered on the manufacture and sales of interioruse decorative laminates, we are involved in supplying residential equipment
and construction materials and developing our own planning houses. In theconstruction business, we are promoting livable urban development through abroad range of operations including slope protection construction, landscapegardening, and the installation of industrial equipment and solar power
generations. In other businesses, we have a range of lines of business toanswer the changing needs of society, including the development and sale ofmedical software, and the power generation business.

Segment Strategies

For clients consisting of major global semiconductor
manufacturers as well as tablet PC and smartphone
manufacturers, we have been manufacturing andselling IC package substrates and printed wiringboards. As of January of 2015, our Electronics
Operation underwent an organizational integration
to form one operational headquarters, resulting in
the establishment of a stable earnings structure
supported by three pillars: PKG, CSP and PWB.

Net Sales & Segment Income(Millions of Yen)
Segment Income

Net Sales

250,000

50,00040,000200,000
171,259
150,000

153,896

150,561

159,850
30,000147,872

100,000
10,66850,00014,168

11,472
10,000

6,445
289

0

12

13

14

15

(Millions of Yen)
Segment Income

120,000

30,00098,70280,00075,521

99,191

104,768

75,31140,00020,00010,000

8,418
6,397

6,348

5,914

15

16

2,168
0

In the construction business, we strive to expand ourbusiness by leveraging products with distinguishedfeatures such as our unique component housing andantiviral melamine decorative laminates. In theconstruction business, we use our strength to expand
operations in the areas of the slope protection
construction and landscape gardening businesses
based on contemporary themes such as environmental conservation and disaster prevention. We arealso redoubling efforts to comply with renewableenergy feed-in tariffs and expand related businesses.
We continue to solidify the position of the Other
Operation as a third source of revenue through expansion of business with distinguished products andlong-term stable earnings through the power business.

0

16

Net Sales

Within our Ceramics Operation, we manufactureand sell SiC-DPF, SCR, substrate holding mats,high temperature insulation wool and graphite
specialty products for clients such as major global
automotive manufacturers and semiconductor
manufacturing equipment manufacturers. Goingforward, we will expand business within the large
vehicle market for DPF, SCR and AFP.

20,000

12

13

14

0

(Millions of Yen)
Segment Income

Net Sales

12,00090,00059,03160,0005,393

61,479

5,156
4,000

30,000

0

8,000

12

13

14

15

16

0

Note: As the Company has changed its segment classification, no data for the years ended
March 31, 2014, 2013 and 2012 are shown.

13

Review of Operations

Electronics Operation(Free via stacked up structure)

Build up FC-CSP substrate

Main Products● Package substrates (PKG, CSP)
(for computers, mobile devices and home information appliances)

Net Sales
Composition● Printed wiring boards (PWB)

47.1%

14

(for use in mobile electronic equipment/information communication
infrastructure*)*Used in servers, routers and other equipment forming high-speed digitalcommunication networks.

¥147,872 million¥11,472 million
Segment Income
Net Sales

In the Electronics Operation,
sales in the PC market remainedsluggish, and sales in smartphones
and tablet-type devices market,
which has been the driving forceof the Electronics Operation, slowed

Net Sales

33.4%

200,000

150,000

159,850

150,561(Millions of Yen)
Segment Income

80,000significantly from the second halfof the previous fiscal year.
As a result, net sales generated

147,872

High-performance and high-function package

60,000from the Electronics Operation substratedeclined 7.5% year on year, to¥147,872 million. Segment income amounted to ¥11,472 million, down 19.0% from40,000100,000

50,000
10,6680

14

14,16815

19.5%

20,00011,472160

the previous year.

Ceramics Operation

47.1%
Graphite specialty “EDX-7”

Substrate holding mat

IBI WOOL-E

Main Products● Diesel particulate filters (DPF)● Substrate holding mats (AFP)● NOx reduction catalysts (SCR)● Graphite specialty products (FGM)

Net Sales
Composition

33.4%(for semiconductor manufacturing equipment and new energyrelated products)● High temperature insulation wool
● Fine ceramics products¥104,768 million¥5,914 million
Segment Income

Net Sales

Sales of DPF and substrate holding mats (AFP) expanded from the previous fiscal year
due to an increase in the major automobile markets of Europe and North America.
Sales of NOx reduction catalysts (SCR) remained roughly at the same level as theprevious year in automotive exhaust system components, despite sluggish sales

Net Sales

19.5%

120,000
98,702

99,191(Millions of Yen)
Segment Income

40,000accompanying the ongoing transitional period for exhaust gas regulations.
Sales of graphite specialty products (FGM) increased from the previous fiscal year,
supported by a sales expansion in the midst of a difficult market environment.

104,768

90,00030,00060,00020,000Accordingly, consolidated net sales
in the Ceramics Operation rose 5.6%
year on year, to ¥104,768 million.
Segment income totaled ¥5,914 million,
down 6.8% from the previous fiscal

30,000

0

8,418

14

10,000
6,348

5,914

15

16

year, due to start-up costs of IBIDEN
Mexico S.A. de C.V., in addition to0changes in the product mix of the mainstay DPF and a decline in sales prices.
SiC-DPF15

47.1%

Review of Operations

Other Operation

33.4%
Higashi-Yokoyama Power
Plant

The Japan’s largest water
floating solar power
generation

Local Village Ogaki

Main Businesses● Melamine decorative laminates/
Residential equipment● Slope and garden construction● Synthetic resin processing● Oil products sales

Net Sales
Composition

19.5%

16

Net Sales
Segment Income¥61,479 million¥5,156 million

The laminates-related department
succeeded in generating net sales ona par with the previous fiscal year, byredoubling efforts to boost sales ofmelamine decorative laminates fortoilet booths, and noncombustible(Millions of Yen)
Segment Income

Net Sales

12,00080,000laminates. Sales of services equipment
for housing increased due to a rise inconstruction of component housing.

59,03160,00061,479Retect Viruhael: high pressure laminates withantiviral effect

The slope protection construction department saw virtually flat sales, as the
9,000

previous fiscal year, reflecting the completion of large-scale projects as planned.
The landscape gardening department recorded nearly unchanged sales, due to40,000

5,393

5,156

6,000

stable demand from public-private partnership projects.

3,000

lower sales prices, despite higher sales volume.

The synthetic resin processing department experienced a drop in sales reflecting
20,000Consequently, consolidated net sales in the Other Operation totaled ¥61,479
million, up 4.1%, while segment income was ¥5,156 million, down 4.4% from the
0

14

15

16

0

Note: As the Company has changed its segment classification,
no data for the year ended March 31, 2014 is shown.

previous fiscal year.

Research and Development
R&D activities of the Group are implemented extensively by

Ceramics Operation

technology development divisions and manufacturing technology

Our current focus for R&D for next-generation products and beyond

divisions, as well as the technology divisions for each of theis environmentally friendly products in the area of automobiles, suchbusinesses, and at domestic and overseas affiliate companies.

as diesel particulate filters (DPF), NOx reduction catalysts (SCR), andAt technology development divisions, we more deeply

substrate holding mats (AFP). Furthermore, we are carrying out R&D

cultivating core technologies in fields related to electronics andfor specialty carbon products and fine ceramic products gearedceramics, as well as product planning based on the uniquemarketing methods. We are also conducting R&D to create
original new products for the next generation and beyond.
At manufacturing technology divisions, we are working

toward environmental and energy-related areas.
R&D costs for this division amounted to ¥5,329 million in thefiscal year under review.

Other Operation

actively to develop new innovative methods and facilities thatIn the housing materials businesses, we are working to develop

boost our competitiveness.

functional construction materials such as antivirus materials. We are

Furthermore, at technology divisions within each of thealso conducting R&D activities geared toward new fields.

businesses, we are carrying out development of new technolo-

Within the slope-related business, we have been developing

gies and products that aim to expand on our existing businesses.

materials improvement and methods of construction evolved fromR&D costs of the Group during the fiscal year ended Marchpatented technology (the GT Frame Method), which makes possible

2016, on a consolidated basis, amounted to ¥15,204 million.
Major R&D activities are as follows:

both slope face disaster prevention and full-out surface vegetation.
In landscape gardening, we are conducting R&D focused ontechnologies for the vegetation of particular spaces such as wall
surfaces and roofs.

Electronics Operation

In the synthetic resin processing business, we are improving on

We have been conducting the development of element and process

basic technologies for the development of new products.

technologies needed for next-generation and beyond semiconductor
package substrates and PWB. Furthermore, we are conducting

R&D costs for this division totaled ¥77 million in the fiscal year
under review.

research for module substrates by taking advantage of our featureseven for applications other than PCs and smartphones.
During the fiscal year under review, R&D costs for this division
amounted to ¥9,796 million.

R&D Costs and Ratio of R&D Costs to Net Sales(Millions of Yen)(%)

18,0005.5

15,000

5.3

12,000

5.1

9,000

4.9

6,000

4.7

3,000

4.5

0

12
Electronics

13
Ceramics

Other

14
Ratio of R&D Costs to Net Sales

15

16

4.3

17

Capital Expenditures
During the fiscal year under review, the IBIDEN Group invested

Major Projects Completed

a total of ¥40,955 million, primarily to establish new facilities to

IBIDENboost production capacity.
Capital expenditures in the Electronics Operation totaled¥19,066 million, which was used mainly for production facilities
for both IC package substrates (¥8,535 million) and PWB(¥10,531 million).
In the Ceramics Operation, the Group spent ¥14,477 million,
primarily for production facilities related to DPF (¥7,566 million)
and substrate holding mats (AFP) (¥5,728 million).
The Other Operation and corporate were allocated¥7,412 million.

Segments/bases

Project description

Electronics Operation•Aoyanagi Plant

Established production facilities for FVSS.

Other Operation•Higashi-Yokoyama Power Plant

Updated (renovated) the power generation facilities for
Higashi-Yokoyama Power Plant.

Subsidiaries
Electronics Operation•IBIDEN Philippines, Inc.

Established production facilities for next-generation IC package substrates (CSP).

•IBIDEN Electronics Malaysia Sdn. Bhd. Established production facilities in the second plant building(phase II).
•IBIDEN Electronics (Beijing) Co., Ltd. Expanded production facilities for FVSS (phase I for FVSS3).

Required funds were acquired through self-financing.

Ceramics Operation•IBIDEN Hungary Kft.

During the fiscal year under review, no major disposal or•IBIDEN Mexico, S.A. de C.V.

Established the second plant building for AFP in the fourth
plant, and utility facilities.
Established production facilities (the first line) for DPF.

removal of facilities took place that would have a noteworthy
impact on production capacity.

Major Projects Established/Expanded/Updated in Progress
IBIDEN
Segments/bases
Electronics Operation•Ogaki Plant

Project description
Established production facilities for next-generation IC package substrates (PKG and CSP).

Subsidiaries

18

Electronics Operation
Established production facilities for next-generation PWB.
•IBIDEN Electronics (Beijing) Co., Ltd.
Ceramics Operation•IBIDEN Hungary Kft.

Established production facilities for AFP at the second plantbuilding in the fourth plant.

•IBIDEN Mexico, S.A. de C.V.

Established production facilities (the second line) for DPF.

Capital Expenditures and Depreciation and Amortization(Millions of Yen)

¥ 40,955 million

75,000Capital expenditures by geographical areas in the fiscal
year under review are summarized as follows:

56,35050,000Electronics-related:Japan.....................................¥7,400 million
Overseas.............................¥11,700 million
Ceramics-related:Japan.....................................¥1,300 million
Overseas.............................¥13,100 million

37,73135,702

39,42840,95525,000014
Capital Expenditures

15
Depreciation and Amortization

16

44,057

Corporate GovernanceCorporate Governance Structure

responsible for internal control of all subsidiaries, the Corporate PlanningGroup, Office of the President, Strategic Corporate Planning Operation.
The Company provides guidance and support to each company incooperation with other internal control promotion divisions.
Pursuant to the Regulations for Internal Approvals of Group
Companies and the Regulations for Management Support of Group
Companies, a structure is in place under which important businessexecution by directors and the Board of Directors of subsidiaries isreported to the Company in advance and decision making of theCompany is properly carried out.
Furthermore, the executive officer in charge of the CSR Promotion
Division sufficiently exchanges information with directors in charge ofinternal control or the department.
Indicated below is a diagram of the corporate governance system of
the Company.

Overview of Corporate GovernanceTo ensure fair and highly transparent management, IBIDEN invites two
persons to serve as outside directors on the Company’s Board of
Directors to reflect their advice in the management of the Company. The
maximum number of directors is set at 18, while the term of eachdirector is limited to one year to clarify the management accountability ofeach director, strengthen management practices and enhance the agility
needed to implement optimal management practices and respondquickly to the changing business environment. An executive officer
system has been introduced to enable swift managerial decision-making
and accelerated business execution.
IBIDEN has elected to operate as a company with corporate auditors and a Board of Auditors.
In addition to the corporate governance structure described above,
the Company has set up a Management Council to fortify its structure.
Composed of parties responsible for management decisions and business execution such as representative directors, directors, executive
officers and managing officers, in addition to full-time corporate auditors,
the Management Council is authorized to conduct advance deliberations
on matters to be placed on the agenda of the Board of Directors and isauthorized, under the Company’s rules on authorizations, to approve
such items. It also deliberates on and decides important matters
including management of the progress made in yearly and monthly
budgets and managerial issues.
To ensure the appropriateness and fairness of business conductedby the IBIDEN Group companies, IBIDEN has advised the heads of theGroup companies to use a structure, designed to advance complianceand risk management, that is similar to its own. At Group informationexchange meetings, it keeps abreast of actions advocating complianceand risk management, the status of management and progress made tomeet the targets mapped out in their plans for profit generation.

Reasons for Establishment of the Corporate Governance Structure
The IBIDEN Group’s corporate governance is conducted effectively
and efficiently under the current corporate auditor system. Given thebusiness size and organizational structure of the Group, the Company
believes that the current structure is best suited to the Group in termsof achieving the independence of auditing work and the efficiency ofcorporate governance.
Current Status of the Internal Control System and Risk
Management Structure
Based on the belief that corporate governance is a crucial management
issue, the Group’s internal control system calls for proactive implementation of measures across the Group aimed at advancing compliance andrisk management and further augmentation of monitoring functions. The
status of actions and their development are reported regularly by executive officers in charge of compliance and risk management promotion
to the Board of Directors and the Management Council, and such actions
are monitored and reviewed from time to time to make the complianceand risk management structure fairer, stronger and more appropriate.

Status of Development of System to Ensure the Appropriatenessof Business Operations at Subsidiaries
The Company made the supervisory management department, which is
The Corporate Governance System

General Meetings of Shareholders
ReportAppointment,
Dismissal

ReportProposal for Appointment/Dismissal of
Accounting Auditors

Directors,
Board of Directors
Supervision

Assignment (Consultation)
Committee
Compensation (Consultation)
Committee
Deliberation,
ReportSupervision

Execution of Operation,
Supervision

ReportDeliberation,
ReportPresident & CEO (Overall Management on
Execution of Operation)
Executive Officer of Each Business(Division of Executive Authorities)

Report, Cooperation

Direction

Accounting Auditors

Evaluation of properness on
Accounting Audit

Policy Proposal

CSR Promotion Division

Management Council
Representative Directors (Executive Officers)
Full-time Directors (Executive Officers)
Executive Officers

Appointment,
Dismissal

ReportReport, Cooperation

Auditors(Board of Auditors)

Audit

Opinion, Support

Appointment,
Dismissal

Report, Cooperation
Policy Proposal

Risk Management Company-Wide
Promotion Committee

Compliance Company-Wide
Promotion Committee

Executive Officer in Charge of Risk Management
Executive Officer in Charge of CSR Promotion Division

Executive Officer in Charge of Compliance
Executive Officer in Charge of CSR Promotion Division
Cooperation

Compliance Committee
Reward and Disciplinary Committee*
Information Security Committee
Security Trade Control Committee
Insider Trading Control System
Disclosure Committee

Report

Audit

Audit

Development

Development

Accounting Audit

Each Operation, Administrative Division and Group Company*It shall be held at any time as needed19Corporate GovernanceStatus of Internal Audits and Audits by Corporate Auditors
The Company has four corporate auditors, two of whom are outside
corporate auditors with no conflict of interest with the Company. Twoof the four corporate auditors of the Company are persons who havesubstantial knowledge of finance and accounting, through obtaining
professional qualifications such as certificates to practice tax
accounting or public accounting.
Corporate auditors participate in major meetings including those of
the Board of Directors and the Management Council to audit the business executed by the directors. In addition, full-time corporate auditors
work in cooperation with the CSR Promotion Division, which is theinternal auditing organ of the Company, and accounting auditors to
perform audits on IBIDEN and its Group companies as required by law
and other rules.
Executive officers and others submit reports at the request of thecorporate auditors in compliance with the Rules of the Board ofAuditors and the Corporate Auditors’ Auditing Rules set forth by the
Board of Auditors.
The Company has also created an Audit Group in CSR Promotion
Division (comprising seven members), which is responsible for
executing internal audits. Corporate auditors and CSR Promotion
Division have forged mutual close cooperation including regularexchange of information and opinions with accounting auditors toensure greater effectiveness of the audit structure of the Group.

20

Outside Directors and Outside Corporate Auditors
As stated in the preceding section, the Company has a governancestructure that includes two outside directors and two outside corporate
auditors. The Company anticipates their contribution to proper and faircorporate governance and their valuable advice concerning the
Employee’s Code of Conduct. Although IBIDEN has no standard orpolicy of its own with respect to the requirements to ensure the independence of outside directors and outside corporate auditors, when electing
any of its outside directors or outside corporate auditors, IBIDEN makes
sure that he or she meets the requirements of being independent and ofbeing unlikely to have any conflict of interest with the general shareholders of IBIDEN.
Shozo Saito, who serves as IBIDEN’s outside director, is outside
director of TOKYO SEIMITSU CO., LTD. No special relationship exists
between the said company and IBIDEN. Chiaki Yamaguchi, who
serves as IBIDEN’s outside director, is representative director and president of Towa Real Estate Co., Ltd. No special relationship exists
between the said company and IBIDEN.
Fumio Kato, representative of Fumio Kato Certified Tax Accountant
Office, serves as outside corporate auditor. No special relationshipexists between the said company and IBIDEN. The outside corporate
auditor, Masaki Horie is representative of Masaki Horie Certified Tax
Accountant Office. No special relationship exists between the said
company and IBIDEN.
At IBIDEN’s Board of Directors meetings, outside directors express
opinions based on their wealth of managerial experiences and provide
important advice to advance the IBIDEN Group’s governance. Outside
corporate auditors express their opinions based on their professional
expertise in taxation and financial matters at the Board of Directors andthe Board of Auditors meetings and provide fair and objective advice to
the Company’s directors. The Company believes that the aforementioned outside directors and the outside corporate auditors, who havedemonstrated their independence, have successfully undertaken their
responsibilities expected of them by the Company.
Number of Meetings Convened by Principal Management Bodies
Board of Directors

12

Board of Auditors

15

Outside director attendance at Board of Directors’ meetings

96%

Outside corporate auditor attendance at Board of Auditors’ meetings

100%

Outside corporate auditor attendance at Board of Directors’ meetings

100%

Overview of Limited Liability Agreements
We have entered into limited liability agreements with outside directors
and outside auditors that limit their liabilities for damages, based on
Paragraph 1, Article 423 of the Company Law. Under these agreements, outside directors are subject to the higher of either ¥20 million
or the minimum limited amount as specified under Paragraph 1, Article
425 of the Company Law when they have acted in good will and they
have committed no material negligence in executing their duties.
Under these agreements, outside auditors are subject to the higher of
either ¥18 million or the minimum limited amount set forth under Paragraph
1, Article 425 of the Company Law when they have acted in good will andthey have committed no material negligence in executing their duties.

Corporate Audit
We have concluded a corporate auditing agreement with Ernst &Young ShinNihon LLC, and the certification of the audit is conductedby certified public accountants Shingo Watanabe, Toshikatsu
Sekiguchi and Tomoaki Ito, who are Ernst &Young ShinNihon’s designated and engagement partners.
They are assisted by 11 certified public accountants and sevenother staff in the conduct of their auditing duties.

Board Policies and Procedures in Determining theCompensation of the Senior Management and Directors
The compensation for the Company’s directors and executive officers
comprises monthly compensation and bonuses. The monthly compensation for directors is calculated based on the directors’ job positions,
within the limits approved by the general meeting of shareholders, and isapproved by the board of directors. Bonus allotments for directors are
based on the degree to which each director contributed to theCompany’s operations, within the scope of the total amount of bonuses
calculated using the stipulated formula approved by the general meetingof shareholders, and are approved by the board of directors.
The monthly compensation of executive officers is approved by theboard of directors. In determining this compensation, broad consideration is given to a suitable balance with the monthly compensation for
directors, assessments of individual executive officers’ job performance,and other factors. The amounts of bonuses to be paid are approved by
the board of directors. Bonus amounts are calculated in accordancewith the degree of the executive officer’s contribution to the company’sbusiness results and other factors. Compensation Consultation
Committee including outside directors as committee members, prior to a
resolution of the board of directors, deliberates on compensation andbonus of the board of directors, and reports to President & CEO.
Outside directors, being in positions independent of the execution ofoperations, are only paid a set basic compensation.

Compensation of Directors and Corporate Auditors(a) Total remuneration of directors and corporate auditors for the year
ended March 31, 2016 is as follows:

Position

Total amount of
remuneration(Millions of yen)

Total amount of remuneration by type(Millions of yen)

Basic
Stock
remuneration options

Retirement
Bonuses benefits

Number ofrecipients

Directors (notincluding outside
directors)

¥366

¥291

—

¥75

—

13

Corporate auditors(not including
outside corporate
auditors)

67

67

—

—

—

3

Outside directors
and outside
corporate auditors

43

43

—

—

—

6

Notes:
1. The resolution setting the upper limit of remuneration for the directors at not morethan ¥45 million per month was approved at the 154th General Meetings ofShareholders held on June 22, 2007. Of the total, the amount for outside directors’
accounts for ¥3 million or less, with the remaining ¥42 million or less paid to theother directors. Compensation under stock option plans is set separately. Salary fordirectors as company employees is also excluded from the figures.
2. In addition to the remuneration mentioned above in 1, at the 158th General
Meetings of Shareholders held on June 22, 2011, the resolution was approved stipulating that directors, excluding the outside directors, are to receive a bonus equal
to 0.5% of the consolidated net income for the fiscal year as well as 1.6% of thetotal amount of annual dividends for the applicable fiscal year. However, themaximum limit was also set at not more than ¥500 million by the resolution withamounts less than ¥1 million being rounded down.
3. Although bonuses for directors amounted to ¥113 million based on the above calculation, recognizing the severe operating environment and the difficulties in the
Company’s severe performance during the fiscal year, bonuses for directors totaling¥75 million were approved by the Board of Directors’ meeting held on May 16, 2016.
4. In addition to the above payments, three subsidiaries of the Company paid a total
amount of ¥8 million as monthly remuneration to the three directors of said subsidiaries who also served concurrently as directors of the Company.
5. The maximum limit of remuneration for corporate auditors was approved at not
more than ¥9 million per month at the 159th General Meetings of Shareholders heldon June 20, 2012.

(b) Total amount of consolidated remuneration of individual directors
and corporate auditors
Not recorded because no individual received total consolidated remuneration of ¥100 million or more.
(c) Board policies and procedures in determining the compensation of
the directors
The compensation for the Company’s directors comprises monthly
compensation and bonuses. The monthly compensation for directors
is calculated based on the directors’ job positions, within the limits
approved by the general meeting of shareholders, and is approved by
the board of directors. Bonus allotments for directors are based on the
degree to which each director contributed to the Company’s operations, within the scope of the total amount of bonuses calculated using
the stipulated formula approved by the general meeting of shareholders, and are approved by the board of directors.

Matters for Resolution at General Shareholders’ MeetingsThat May Be Resolved at Board of Directors’ Meetings
The Company’s Articles of Incorporation stipulate that the Company,
by a resolution of the Board of Directors, may determine the amount ofdividends to be paid from reserves and acquire its own shares throughmarket transactions and other methods unless otherwise provided,
pursuant to Paragraph 1, Article 459 of the Company Law. This allows
the Company flexibility in conducting its business.
Furthermore, as stipulated under Paragraph 5, Article 454 of theCompany Law, the Board of Directors agreed that in accordance with
the Company’s Articles of Incorporation interim dividends shall be paideach year on September 30.

Policies and Procedures for the Selection of Corporate
Managers and the Assignment of Director and Corporate
Auditor Candidates by the Board of Directors
Corporate manager and director candidates are selected/assigned fromthe perspective of placing the right person in the right job, with due
consideration given to the number of people that would enable precise
and prompt decision-making and to a balance of knowledge, experience, and skills among the corporate management team/board of
directors overall. Corporate auditor candidates are also selected/
assigned from the perspective of placing the right person in the right job,with due consideration given to a balance among knowledge of financial,accounting and legal matters, knowledge about the Company's business, and other perspectives pertinent to corporate management. A
corporate auditor candidate with the consent of the board of auditors is
selected by resolution of the board of directors in comply with policies
above. Assignment Consultation Committee including outside directors
as committee members, prior to a resolution of board of directors, deliberates on assignment such corporate director candidates and corporate
auditor candidates and reports to President & CEO.

Resolution Requirement for Appointing Directors
The Company’s Articles of Incorporation stipulate that directors may be
appointed by a majority vote of shareholders present at a meeting,
who collectively hold not less than one-third of the voting rights of allshareholders entitled to exercise the rights.
Furthermore, the Company’s Articles of Incorporation also stipulatethat appointment of directors shall not be determined by cumulative voting.

Special Resolution Requirement for General Meetingsof Shareholders
The Company has stipulated in the Articles of Incorporation a special
resolution requirement at General Meetings of Shareholders, in accordance with the provision of Paragraph 2, Article 309 of the Company
Law, as follows: The resolution shall be authorized by a two-thirds
majority of the voting rights held by the shareholders present at General
Meetings of Shareholders. These voting shareholders must hold shares
representing not less than one-third of the voting rights of all shareholders entitled to exercise the rights. This enables General Meetings ofShareholders to progress smoothly.

Overview of Shareholdings(a) Investment shares held for purposes other than pure investment
Number of issues: 53
Total recognized on the balance sheet: ¥36,562 million(b) The main purpose for holding investment shares other than pureinvestment is to strengthen a stable business relationship.
(c) Shares held purely for investment purposes: None

21

Board of Directors, Auditors and Executive Officers (As of June 17, 2016)
Directors

President & CEO,
Representative Director

Hiroki TAKENAKA
Date of Birth: January 1, 1951
Apr. 1973
Jun. 1997
Jun. 2001
Jun. 2005
Apr. 2007
Jan. 2015
Mar. 2016

Joined IBIDEN Co., Ltd.
Director
Managing Director
Director & Executive Managing Officer
Representative Director, President & CEO (to present)
In charge of R&D Operation (to present)
In charge of affiliates and subsidiaries (to present)

Representative Director &Executive Vice Presidents

Takeshi AOKI

22

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
Director & Corporate Officer
Director & Managing Officer
Deputy Operation Manager of Ceramics Operation
Representative Director, Vice President (to present)
Operation Manager of Ceramics Operation (to present)

Date of Birth: July 10, 1956
Apr. 1980
Apr. 2008
Apr. 2011
Jun. 2013
Apr. 2014
Apr. 2014
Jan. 2015
Jan. 2015
Jan. 2015
Mar. 2016

Apr. 1975
Jun. 2003
Jun. 2005
Apr. 2008
Apr. 2012
Jan. 2015
Jan. 2015
Jan. 2015
Jun. 2015

Kozo KODAMA

Tsuyoshi NISHIDA

Date of Birth: February 4, 1958
Apr. 1981
Apr. 2006
Apr. 2008
Jun. 2013
Apr. 2014
Apr. 2014
Mar. 2016
Mar. 2016

Representative Director &Executive Vice Presidents

Representative Director &Executive Vice Presidents

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
Director & Corporate Officer
Director & Managing Officer
Operation Manager of PKG Operation
Director & Executive Managing Officer
Operation Manager of Electronics Operation(to present)
Director of IBIDEN Electronics (Beijing) Co., Ltd. (to present)
Representative Director, Vice President (to present)

Date of Birth: March 23, 1963
Apr. 1986
Apr. 2008
Apr. 2012
Apr. 2012
Jan. 2015
Jan. 2015
Jun. 2015
Mar. 2016
Mar. 2016

Director & Executive
Managing Officer

Director & Executive
Managing Officer

Takayuki TAKAGI

Masahiko IKUTA

Sotaro ITO

Date of Birth: January 13, 1951

Date of Birth: August 19, 1962

Date of Birth: January 16, 1962

Joined IBIDEN Co., Ltd.
Director (June 2005 Resigned from Director)
Corporate Officer
Managing Officer
Executive Managing Officer (to present)
Operation Manager of Strategic Manufacturing Operation(to present)
In charge of CSR Promotion (to present)
In charge of Energy Control Division (to present)
Director & Executive Managing Officer (to present)

Apr. 1985
Apr. 2008
Apr. 2011
Oct. 2013
Oct. 2013
Jun. 2014
Mar. 2016

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
In charge of FGM Operation (to present)
In charge of IR, Operation Manager of Strategic
Corporate Planning Operation (to present)
Director & Managing Officer
Director & Executive Managing Officer (to present)

Director & Senior Managing
Officer

Apr. 1986
Apr. 2008
Apr. 2010
Jun. 2011
Oct. 2015
Mar. 2016
Mar. 2016
Jun. 2016

Director & Senior Managing
Officers

Director & Managing Officer

Kazushige OHNO

Koji KAWASHIMA

Date of Birth: September 15, 1963
Apr. 1987
Apr. 2008
Apr. 2010
Apr. 2010
Jun. 2010
Jan. 2014
Jan. 2015
Mar. 2016
Jun. 2016

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
Vice President of IBIDEN Philippines Inc.
Managing Officer
Deputy Operation Manager of Electronics Operation(to present)
Director & Managing Officer
Representative Director, Vice President (to present)
Integrated management of Quality, Engineering and
Production (to present)

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
Operation Manager of PKG Operation
Director & Managing Officer (June 2012 Resigned
from Director)
Deputy Operation Manager of Strategic Corporate
Planning Operation (to present)
Division Manager of HR&GA Division of Strategic
Corporate Planning Operation (to present)
Managing Officer (to present)
Director (to present)

Date of Birth: October 05, 1966
Apr. 1991
Feb. 2006
Apr. 2008
Apr. 2012
Apr. 2013
Jun. 2013
Oct. 2015
Mar. 2016

Joined IBIDEN Co., Ltd.
Waseda University PhD (Engineering)
Executive
Corporate Officer
Operations Manager of R&D Operation
Director & Managing Officer (to present)
Deputy Operation Manager of Ceramics Operation(to present)
Division Manager of SCR Division of Ceramics
Operation (to present)

Joined IBIDEN Co., Ltd.
Corporate Officer
Operation Manager of PWB Operation
Director & Managing Officer (June 2013 Resigned
from Director)
Director Manager of DPF Division of Ceramics
Operation (to present), Division Manager of DPF
Sales Division of Ceramics Operation
Managing Officer (to present)
Deputy Operation Manager of Ceramics Operation(to present)
Director (to present)Outside Director

Outside Director

Date of Birth: July 9, 1950

Date of Birth: December 25, 1949

Shozo SAITO
Jun. 2007
Jun. 2010
Jun. 2012
Jun. 2013
Jun. 2013
Jun. 2015

Chiaki YAMAGUCHI

Executive Officer, Corporate Vice President of Toshiba
Corporation
Executive Officer, Corporate Executive Vice Presidentof Toshiba Corporation
Director, Representative Executive Officer, Corporate
Senior Executive Vice President of Toshiba Corporation
Outside Director of IBIDEN Co., Ltd. (to present)
Executive Adviser of Toshiba Corporation (to present)
Outside Director of Tokyo Seimitsu Co., Ltd. (to present)

Jun. 2003
Jun. 2011
Jun. 2012
Jun. 2014
Jun. 2015
Jun. 2015

Full-time Corporate Auditor of Toyota Motor
Corporation
Executive Managing Director of Toyota Industries
Corporation
Representative Director & Senior Vice President of
Toyota Industries Corporation
Outside Director of IBIDEN Co., Ltd. (to present)
President & Representative Director of Towa Real
Estate Co., Ltd. (to present)
Outside Director of Nakanihon Kogyo Co., Ltd. (to present)

Auditors

Standing Auditor

Standing Auditor

Yoichi KUWAYAMA

Keiichi SAKASHITA

Date of Birth: May 30, 1958

Date of Birth: April 21, 1956
Apr. 1981
Apr. 2007
Apr. 2009
Apr. 2009
Apr. 2011
Apr. 2013
Jan. 2015
Jan. 2015
Jun. 2015

Joined IBIDEN Co., Ltd.
Director & Managing Officer
In charge of Ceramics Operation
Operation Manager of DPF Operation
Operation Manager of Strategic Manufacturing Operation
Director & Executive Managing Officer
In charge of Audit
In charge of IMS promotion
Standing Auditor (to present)

Apr. 1983
Apr. 2007
Apr. 2008
Apr. 2011
Apr. 2012
Jun. 2012
Apr. 2014
Apr. 2014
Mar. 2016
Jun. 2016

Joined IBIDEN Co., Ltd.
Executive
Corporate Officer
Operation Manager of DPF Operation
Managing Officer
Director & Managing Officer
Director & Executive Managing Officer
Operation Manager of Ceramics Operation
In charge of Audit
Standing Auditor (to present)

Outside Corporate Auditor

Outside Corporate Auditor

Substitute Outside Corporate
Auditor

Masaki HORIE

Shogo KOMORI

Date of Birth: January 20, 1944

Date of Birth: November 25, 1949

Date of Birth: October 23,1979

Fumio KATO
Jul. 2000
Jul. 2001
Aug. 2002

Jul. 2004
Nov. 2014
Jun. 201523

Deputy Manager of Investigation Department Nagoya
Regional Taxation Bureau
Superintendent of Showa Tax Office
Registered as certified tax accountant, Opened
Fumio Kato Certified Tax Account Office,Representative of Fumio Kato Certified Tax Account
Office (to present)
Outside Corporate Auditor of Seino Holdings Co., Ltd.
(to present)
Outside Corporate Auditor of Himaraya Co., Ltd. (to present)
Outside Corporate Auditor of IBIDEN Co., Ltd. (to present)

Apr. 1973
Nov. 1980
Jul. 1997
Jan. 2001
Sep. 2006
Jul. 2010
Jun. 2011
Jun. 2015
Jun. 2016

Joined PricewaterhouseCoopers Co., Ltd.
Joined Ito Accounting & Consultancy OfficeSenior Partner of Ito Accounting & Consultancy OfficeSenior Partner of Chuo-Aoyama Audit Cooperation
Senior Partner of Arata Audit Cooperation
Opened Masaki HORIE Certified Public Accountant
Office, Director of the office (to present)
Outside Corporate Auditor of Tokai Rika Co., Ltd.
Outside Corporate Auditor of Futaba Industrial Co., Ltd.
Outside Corporate Auditor of IBIDEN Co., Ltd. (to present)

Oct. 2003
Oct. 2004
Mar. 2012
Apr. 2012
Jun. 2015

Registered as attorney (Daini Tokyo Bar Association)
Joined Anderson Law Office
Switched the registration as attorney to Gifu Prefecture
Bar Association
Joined Mori Law OfficeOpened Shogo KOMORI Law Office, Representativeof the office (to present)
Vice-chairman of Gifu Prefecture Bar Association
Substitute Outside Corporate Auditor of IBIDEN Co., Ltd.
(to present)

Executive Officers
President & CEO

Executive Managing Officers

Managing Officers

Hiroki Takenaka

Takayuki Takagi

Kazushige Ohno

Masahiko Ikuta

Syuichi Kubo

Executive Vice Presidents

Honchin Endo

Takeshi Aoki

Senior Managing Officers

Tsuyoshi Nishida

Sotaro Ito

Kozo Kodama

Koji Kawashima

Yasuji Hiramatsu

CSR Management

IBIDEN achieves sustainable growth by implementing CSR management
in response to globalization.
Diagram of CSR Management| CSR Policy

Employees

We aim to enhance our corporate value
Customers
Human Resource• By raising awareness of the need for IBIDEN to
Management
act responsibly and honestly in the interest of
Shareholders/sustainable operations
Internal Control
Investors• By fulfilling our responsibilities in a well-balanced
SocialEnvironmental
Contribution
Management
manner from an economic, environmental andsocial standpoint• By working in partnership with all of our stakeholders
Global environment

Suppliers

Building a trustworthy relationshipwith all our stakeholders.
| External Corporate Evaluation

24

The Company conducts gap analyses between targets and results of external corporate evaluations such as SRI
evaluation organizations, and identifies elements that are lacking within the Company. The CSR Promotion Division
is responsible for analyses. For items which can be improved during the following fiscal year, the relevant departments develop improvement strategies within the action policy. IBIDEN has been awarded “Prime” status by oekom
research AG*, a Germany-based CSR rating agency, in its CSR rating. (As of June 2016)* oekom research AG, an independent CSR rating agency based in Germany, was founded in 1993, and has conducted CSR rating froman environmental and social aspect.

| Publication of CSR Information
The Group’s CSR Report is disclosed on our website in accordance with the core section of
the GRI G4 Sustainability Reporting Guidelines (Version 4). We will update detailed environmental and social information on the website in an appropriate manner.

| Internal Control

Compliance Promotion Activities
IBIDEN has established the IBIDEN employees’ code of conduct and implements activities
aimed to promote awareness of it. We also set targets for voluntary compliance activities andcarry them out at respective business locations each year. We aim to enhance the level ofthese compliance activities by organizing them at a number of different business locations.

Local
communities

| Environmental Management

Measures to Develop Clean Energy
We have been conducting hydroelectric power generation since its foundation and currently operate
three hydroelectric power plants in the upstream on the Ibi River. The generated power is supplied
to power consumers in the region. We will continue to utilize hydroelectric power as a source ofclean energy.
Hydroelectric power generated in fiscal year 2015

111,682 Mwh

Equivalent to the annual energy consumptionof about 31,000 households.

Higashi-Yokoyama power plant

Trends of CO2 emissions*1 [IBIDEN Group]

Energy Conservation

Global target for fiscal years 2013 to 2017:

3% (fiscal year 2017) compared to actual CO emissions for fiscal year 2012.
2

Notes:*1: CO2 emissions show figures covering production-related locations in Japan and overseas. With regard to the CO2
emission factor at the time of calculation, we used the factor provided by the “List of Calculation Methods/Emission
Factors in the Calculation, Report and Publication System” of the Ministry of the Environment and the Ministry of
Economy, Trade and Industry in Japan as well as by gas distribution companies.
*2: CO2 emissions indicate emissions from all production bases related to production in Japan and overseas.

800
CO2 emissions (1,000t -CO2)

We are accelerating the improvement of energy conservation practices designed to lower the basic
unit of energy consumption in all divisions within the entire Company, striving to strengthen thecompany-wide CO2 reduction activities as well as our product-making system.

760

718
600

641

623

127

124

147

182
400

200

494

441

593

633

15

16

0

13

14

■ Direct CO2 emissions (Scope 1) ■ Indirect CO2 emissions (Scope 2)| Human Resource Management

25

Human Resource Development
We plan to define model employees with the respective qualifications and to carry out education andtraining to enhance our strength, and thus become a company that can grow and develop on apermanent basis.

Respect for Worker Rights

Educational training

We believe it is important to work on the issue of human rights with the entire supply chain and thus
cooperate with our direct suppliers in dealing with such issues. In IBIDEN Group Supplier CSR guidelines, we specifically request that labor-related human rights be observed, including bans of childlabor and forced labor.

Occupational accident frequency rate
(IBIDEN and Domestic Group companies)

1.6
1.2

Occupational Health and Safety
Mainly through the occupational health and safety activities requiring the participation of all our
employees, we have achieved an occupational accident frequency rate* of the domestic Group
companies at a level below the national manufacturing industry average.
* Number of occupational injuries (equal to or exceeding accidents requiring leave) for every million cumulative actual
working hours.

1.59

1.58

1.00

0.94

0.8
0.4
0

0.40
0.08

13

0.31

1.66

1.06
1.06

IBIDEN Group (Japan)
Manufacturing Industry

0.09

15
IBIDEN Domestic Plants
All Industries| Social Contribution

Protecting the Global Environment
In fiscal year 2008, we embarked on a forest building initiative: “IBIDEN’s Forest.” This activity takes
place chiefly in Higashi-Yokoyama, where the Company operates its initial hydroelectric power
generation business. Together with local residents, employees and former employees, we aim toachieve coexistence with the global environment.
Scene of tree planting activity

Total area of “IBIDEN’s Forest”

41.31 haThis forest area is equivalent to some 58 football fields.

0.66
0.54

0.26

0.17

14

1.61

16

Consolidated Balance SheetIBIDEN CO., LTD. and Consolidated Subsidiaries
March 31, 2016 and 2015
Thousands of
U.S. dollars(Note 5)

Millions of yen

2016

2015

2016

Cash and deposits (Notes 6 and 21).............................................................................. ¥104,765¥106,646$930,256

3,200

5,197

28,411

Trade..........................................................................................................................

57,57959,655511,268

Allowance for doubtful accounts.................................................................................

(290)

(347)

(2,578)12,758

13,201

113,284

AssetsCurrent assets:
Short-term investments (Notes 6, 7 and 21)..................................................................
Notes and accounts receivable (Note 6):

Inventories:
Merchandise and finished goods................................................................................
Work in process.........................................................................................................

9,900

9,866

87,909Raw materials and supplies........................................................................................

14,446

14,938128,268

Deferred income taxes (Note 12)...................................................................................

2,211

2,877

19,635

Other current assets......................................................................................................

9,043

9,739

80,300Total current assets..........................................................................................................

213,612221,772

1,896,753

Land (Note 16)...............................................................................................................

19,144

19,056

169,987

Buildings and structures (Notes 14 and 15)...................................................................

183,541

183,649

1,629,744

Machinery and equipment (Notes 14 and 15)................................................................

441,654444,089

3,921,632

26
Property, plant and equipment:

Leased assets...............................................................................................................

1,826

2,727

16,220Construction in progress (Note 14)................................................................................

16,826

31,393

149,404

662,991

680,9145,886,987

Accumulated depreciation............................................................................................. (447,063)(444,760)(3,969,667)

215,928

236,154

1,917,320

Property, plant and equipment, net...................................................................................

Investments and other assets:
Investment securities (Notes 6, 7 and 9):
Unconsolidated subsidiaries and affiliates...................................................................

892

892

7,918

Other..........................................................................................................................

38,16951,395338,915

Long-term loans receivable (Note 6)..............................................................................

40

32

351

Deferred income taxes (Note 12)...................................................................................

680

1,311

6,036

Other assets..................................................................................................................

7,103

8,631

63,076

Allowance for doubtful accounts....................................................................................

(314)

(340)

(2,786)

Total investments and other assets...................................................................................

46,57061,921

413,510

Total assets (Note 23)....................................................................................................... ¥476,110¥519,847$4,227,583

Thousands of
U.S. dollars(Note 5)

Millions of yen

2016

2015

2016

¥25,665$400,153

31,882
18,150
341
6,318
6,457
36
3,958
167
5,192
98,166

307,841
150,646
1,285
57,152
11,57214
31,145684
49,486
1,009,97825,063
101
465
3,751
1,465
30,84550,190
359
504
8,969
1,567
61,589222,543
899
4,127
33,31013,013273,892

64,15264,579188,599(18,302)
299,028

64,152
68,355
210,424(37,115)305,816

569,638
573,428
1,674,645(162,513)
2,655,198

12,478198
160
15,46928,305
4,188
331,52121,003(1)
157
29,12650,285
3,991
360,092

110,794
1,756
1,422
137,360
251,332
37,183
2,943,713

Total liabilities and net assets............................................................................................ ¥476,110¥519,847$4,227,583

Liabilities and net assets
Current liabilities:
Short-term borrowings and current portion of long-term debt (Notes 6 and 8)............... ¥45,065
Notes and accounts payable (Notes 6 and 9):34,669Trade..........................................................................................................................
Other..........................................................................................................................
16,966
Lease obligations (Note 10)...........................................................................................
145
Accrued expenses.........................................................................................................
6,436
Income taxes payable (Note 12).....................................................................................
1,303
Deferred income taxes (Note 12)...................................................................................
2
Accrued bonuses for employees ..................................................................................
3,508
Accrued bonuses for directors and audit & supervisory board members........................
77
Other current liabilities...................................................................................................
5,573
Total current liabilities........................................................................................................ 113,744

Long-term liabilities:
Long-term debt (Notes 6 and 8)....................................................................................
Lease obligations (Note 10)...........................................................................................
Liability for retirement benefits (Note 11)........................................................................
Deferred income taxes (Note 12)...................................................................................
Other long-term liabilities...............................................................................................
Total long-term liabilities....................................................................................................

Net assets:
Shareholders’ equity (Note 13):
Common stock:
Authorized – 230,000,000 shares
Issued – 140,860,557 shares in 2016
and 150,860,557 shares in 2015..........................................................................
Capital surplus............................................................................................................
Retained earnings.......................................................................................................
Less treasury stock, at cost........................................................................................
Total shareholders’ equity..............................................................................................
Accumulated other comprehensive income (loss):
Net unrealized holding gain on other securities...........................................................
Deferred gain (loss) on hedges (Note 22)....................................................................
Surplus arising from land revaluation (Note 16)...........................................................
Translation adjustments..............................................................................................
Total accumulated other comprehensive income...........................................................
Non-controlling interests................................................................................................
Total net assets (Note 19)
See accompanying notes to consolidated financial statements.

27

Consolidated Statement of Income

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Thousands of
U.S. dollars(Note 5)

Millions of yen

2016

2015

2016

Net sales (Note 23)........................................................................................................... ¥314,119¥318,072$2,789,195

Cost of sales....................................................................................................................

238,346

237,242

2,116,375

Gross profit......................................................................................................

75,77380,830672,820

Selling, general and administrative expenses (Note 17).....................................................

53,202

54,791

472,406

Operating income (Note 23).............................................................................

22,571

26,039200,414

Interest and dividend income.........................................................................................

1,186

1,189

10,532

Interest expense............................................................................................................

(319)

(369)

(2,834)

Other, net (Note 18).......................................................................................................

(11,309)

2,745(100,413)

Profit before income taxes...............................................................................

12,12929,604

107,699

Current..........................................................................................................................

(4,233)(9,681)(37,586)

Deferred........................................................................................................................

(127)

(658)

(1,133)(4,360)(10,339)(38,719)

7,769

19,26568,980

(238)

(158)

(2,110)Owners of parent (Note 19).............................................................................. ¥7,531¥19,107$66,870

Other income (expenses):

28

Income taxes (Note 12):

Profit................................................................................................................
Profit attributable to:Non-controlling interests................................................................................................

See accompanying notes to consolidated financial statements.

Consolidated Statement of Comprehensive Income

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Thousands of
U.S. dollars(Note 5)

Millions of yen

2016
Profit................................................................................................................................. ¥7,769

2015

2016

¥19,265$68,980

Other comprehensive (loss) income:Net unrealized holding (loss) gain on other securities.....................................................

(8,550)9,626(75,920)

Deferred gain (loss) on hedges.......................................................................................

199

(1)

1,767

Surplus arising from land revaluation..............................................................................

3

85

32

Translation adjustments.................................................................................................

(13,657)

13,067(121,264)

Total other comprehensive (loss) income (Note 20)...........................................................

(22,005)

22,777(195,385)

Comprehensive (loss) income........................................................................................... ¥(14,236)¥42,042$(126,405)

Owners of parent........................................................................................................... ¥(14,449)¥41,827$(128,295)

213

215

1,890

Comprehensive (loss) income attributable to:Non-controlling interests................................................................................................
See accompanying notes to consolidated financial statements.

29

Consolidated Statement of Changes in Net Assets

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Millions of yen

30

Net
Surplusunrealizedarising
NonTreasury holding gain DeferredStockon other gain (loss) from land Translation acquisition controllingstock,
securities on hedges revaluation adjustments rights
interests
at costNumber ofshares in
issue
Common(Thousands) stock

Capitalsurplus

Balance atApril 1, 2014..............

150,861¥64,152¥68,355 ¥195,459 ¥(37,111) ¥11,433

Cash dividends............

—

—

—

(4,142)

—

—

—

—

—

—

—

(4,142)

Profit attributable toowners of parent........

—

—

—

19,107

—

—

—

—

—

—

—

19,107Purchases oftreasury stock............

—

—

—

—

(4)

—

—

—

—

—

—

(4)

Sales oftreasury stock............

—

—

0

—

0

—

—

—

—

—

—

0

Other changes.............

—

—

—

—

—

9,570

(1)

86

13,066(353)

201

22,569Balance atApril 1, 2015..............

150,861

64,152

68,355

210,424(37,115)

21,003(1)

157

29,126—

3,991

360,092

Cash dividends............

—

—

—

(4,833)

—

—

—

—

—

—

—

(4,833)

Profit attributable toowners of parent........

—

—

—

7,531

—

—

—

—

—

—

—

7,531

Purchases oftreasury stock............

—

—

—

—

(9,486)

—

—

—

—

—

—

(9,486)Retirement oftreasury stock............

(10,000)—(3,776)(24,523)

28,299

—

—

—

—

—

—

—

Other changes.............

—

—

—

—

—

(8,525)199

3(13,657)—

197(21,783)

Balance at
March 31, 2016.........

140,861¥64,152¥64,579 ¥188,599 ¥(18,302) ¥12,478¥198¥160 ¥15,469¥—Retainedearnings¥—¥ 71 ¥16,060

¥353

Total
net
assets¥3,790 ¥322,562¥4,188 ¥331,521

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Thousands of U.S. dollars (Note 5)

Net unrealized
Deferredholding gain
gain (loss)
on otheron hedges
securities

Surplusarisingfrom land
revaluation

Translation
adjustments

Noncontrollinginterests

Total
net
assetsCommonstock

CapitalsurplusRetainedearnings

Treasurystock,
at costBalance atApril 1, 2015..............

$569,638$606,947$1,868,441$(329,562)$186,495$ (11)$1,390$258,623$35,440$3,197,401

Cash dividends............

——(42,914)

—

—

—

—

—

—

(42,914)

Profit attributable toowners of parent .......

——

66,870

—

—

—

—

—

—

66,870Purchases oftreasury stock............

—

—

—

(84,222)

—

—

—

—

—

(84,222)Retirement oftreasury stock............

—(33,519)(217,752)

251,271

—

—

—

—

—

—

Other changes.............

—

—

—

—

(75,701)

1,767

32

(121,263)

1,743(193,422)

Balance at
March 31, 2016.........

$569,638$573,428$1,674,645$(162,513)$110,794$1,756$1,422$137,360$37,183$2,943,713

See accompanying notes to consolidated financial statements.

31

Consolidated Statement of Cash Flows

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Thousands of
U.S. dollars(Note 5)

Millions of yen

2016

2015

2016

¥29,604$107,699

Operating activities
Profit before income taxes................................................................................................ ¥12,129
Adjustments to reconcile profit before income taxes to
net cash provided by operating activities:

32

Depreciation and amortization ......................................................................................

44,05739,428391,200

Loss on impairment of fixed assets................................................................................

6,403

832

56,856(Reversal) provision for accrued bonuses for employees ...............................................

(451)

115

(4,002)

Reversal of allowance for doubtful accounts..................................................................

(84)

(201)

(745)

(Decrease) increase in liability for retirement benefits......................................................

(40)

1

(352)

Interest and dividend income.........................................................................................

(1,186)(1,189)(10,532)

Interest expense............................................................................................................

319

369

2,834

Gain on sales of property and equipment......................................................................

(63)

(193)

(563)

Loss on disposal of property and equipment and other assets......................................

4,058

1,436

36,034Gain on sales of investment securities...........................................................................

(2,194)—(19,478)

Loss on devaluation of investment securities ................................................................

3

1

23

Decrease (increase) in notes and accounts receivable....................................................

517

(745)

4,593

(Increase) decrease in inventories..................................................................................

(252)

594

(2,241)

Increase (decrease) in notes and accounts payable.......................................................

2,474(2,073)

21,966

Other, net......................................................................................................................

2,420(3,046)21,488Subtotal...........................................................................................................

68,11064,933604,780

Interest and dividends received.........................................................................................

1,212

1,169

10,765Interest paid.....................................................................................................................

(319)

(357)

(2,833)

Income taxes paid............................................................................................................

(11,892)(4,198)(105,594)

Income taxes refunded.....................................................................................................

2,388

—

21,201

Net cash provided by operating activities.......................................................................... ¥59,499¥61,547$528,319

IBIDEN CO., LTD. and Consolidated Subsidiaries
Years ended March 31, 2016 and 2015
Thousands of
U.S. dollars(Note 5)

Millions of yen

2016

2015

2016

Investing activities
Purchases of property and equipment.............................................................................. ¥ (42,747)¥ (54,803)$(379,570)

Proceeds from sales of property and equipment...............................................................

80

116

711

Purchases of intangible assets..........................................................................................

(329)

(545)

(2,923)Purchases of investment securities...................................................................................

(166)

(52)

(1,474)

Proceeds from sales of investment securities....................................................................

2,843

0

25,245Long-term loans receivable made.....................................................................................

(11)

—

(95)

Collection of long-term loans receivable............................................................................

2

7

14

Other, net.........................................................................................................................

889

389

7,899

Net cash used in investing activities..................................................................................

(39,439)(54,888)(350,193)

Financing activities(Decrease) increase in short-term borrowings, net............................................................

(2,600)4,504(23,086)

Increase in long-term debt................................................................................................

—

10,000—

Repayment of long-term debt...........................................................................................

(3,127)(206)(27,768)

Proceeds from issuance of bonds....................................................................................

—

25,000—

Redemption of bonds.......................................................................................................

—(25,000)—

Purchases of treasury stock..............................................................................................

(9,483)(4)(84,207)

Proceeds from sales of treasury stock..............................................................................

—

0

—

Cash dividends paid to non-controlling interests...............................................................

(15)

(15)

(135)

Cash dividends paid.........................................................................................................

(4,833)(4,142)(42,914)

Repayments of lease obligations......................................................................................

(521)

(302)

(4,624)

Other, net.........................................................................................................................

100

—

888

Net cash (used in) provided by financing activities.............................................................

(20,479)

9,835(181,846)

Effect of exchange rate changes on cash and cash equivalents.............................

(2,185)

2,306(19,401)(Decrease) increase in cash and cash equivalents....................................................

(2,604)18,800(23,121)

Cash and cash equivalents at beginning of year.......................................................

110,479

91,679980,992

Cash and cash equivalents at end of year (Note 21)................................................... ¥107,875¥110,479$957,871

See accompanying notes to consolidated financial statements.

33

Notes to Consolidated Financial Statements
IBIDEN CO., LTD. and Consolidated Subsidiaries
March 31, 2016

1. Basis of Presentation
IBIDEN CO., LTD. (the “Company”) and its domestic subsidiaries maintain theirbooks of account in conformity with accounting principles generally acceptedin Japan, and its overseas subsidiaries maintain their books of account in conformity with those of their respective countries of domicile.
The accompanying consolidated financial statements have been preparedin accordance with accounting principles generally accepted in Japan, which
are different in certain respects as to the application and disclosure requirements of International Financial Reporting Standards, and have been compiled

from the consolidated financial statements prepared by the Company as
required by the Financial Instruments and Exchange Act of Japan.
In preparing the accompanying consolidated financial statements, certain
reclassifications and rearrangements have been made to the consolidated
financial statements issued domestically for the convenience of readers outside Japan. Furthermore, the notes to the consolidated financial statements
include certain information which is not required under accounting principles
generally accepted in Japan but is presented herein as additional information.

2. Summary of Significant Accounting Policies(a)	Principles of consolidation and accounting for investments inunconsolidated subsidiaries and affiliates	The accompanying consolidated financial statements include the accountsof the Company and its 34 and 39 significant consolidated subsidiaries forthe years ended March 31, 2016 and 2015, respectively.
		 The principles of consolidation are to include significant subsidiaries overwhich substantial control is exerted either through majority ownership ofvoting stock and/or by other means. For the years ended March 31, 2016
and 2015, there are no affiliates accounted for by the equity method.
		 All significant intercompany transactions and accounts have been eliminated in consolidation.
		 Investments in unconsolidated subsidiaries and affiliates are carried atcost or less. Where there has been a permanent decline in the value ofsuch investments, the Company has written them down.
		 The financial statements of certain overseas consolidated subsidiaries
whose fiscal year end is December 31 have been included in consolidationon the basis of a full fiscal year closing on March 31 for consolidation purposes.

34(b) Foreign currency translation
	All monetary assets and liabilities denominated in foreign currencies aretranslated into yen at the rates of exchange in effect at the balance sheet
date and gain or loss on each translation is credited or charged to income.
		 Revenue and expense items arising from transactions denominated inforeign currencies are generally translated into yen at the rates of
exchange in effect at the respective transaction dates. Gain or loss resulting from foreign currency transactions is credited or charged to income inthe year in which the gain or loss is recognized for financial reporting purposes.
		 The balance sheet accounts of the overseas consolidated subsidiaries
are translated into yen at the rates of exchange in effect at the balance
sheet date except that the components of net assets excluding non-controlling interests are translated at their historical exchange rates. Revenue
and expense accounts are translated into yen at the average rates of
exchange in effect during the year. Adjustments resulting from translating
financial statements denominated in a foreign currency are not included in
the determination of profit attributable to owners of parent, but arereported as translation adjustments and non-controlling interests in net
assets in the accompanying consolidated balance sheet.
(c) Cash equivalents	For the purposes of the consolidated statement of cash flows, all highly
liquid investments with a maturity of three months or less when purchased
are considered cash equivalents.
(d) Allowance for doubtful accounts
	An allowance for doubtful accounts of the Company and its domestic consolidated subsidiaries is provided at an amount principally calculated
based on their historical experience of bad debts on ordinary receivables
plus an additional estimate of probable specific bad debts from customers
experiencing financial difficulties.
		 An allowance for doubtful accounts of the Company’s overseas consolidated subsidiaries is provided at an amount principally calculated basedon an estimate of their probable specific bad debts.
(e) Inventories
	Inventories of the Company and its domestic consolidated subsidiaries arestated principally at the lower of cost or net selling value, cost being determined primarily by the moving average method. Inventories of the overseas consolidated subsidiaries are stated principally at the lower of cost or
market, cost being determined primarily by the first-in, first-out method.

(f) Short-term investments and investment securities
	Securities are classified into three categories: trading securities, held-tomaturity debt securities or other securities. Trading securities, consisting ofdebt and marketable equity securities, are carried at fair value. Gain or
loss, both realized and unrealized, is credited or charged to income. Heldto-maturity debt securities are carried at amortized cost. Marketable securities classified as other securities are carried at fair value with any changes
in unrealized holding gain or loss, net of the applicable income taxes,
reported as a separate component of accumulated other comprehensive
income (loss). Non-marketable securities classified as other securities arecarried at cost. Cost of securities sold is determined by the moving average method.
(g)	Property, plant and equipment and depreciation (other than leased
assets)	Depreciation of property, plant and equipment of the Company and its
domestic consolidated subsidiaries is calculated principally by the declining-balance method based on the estimated useful lives of the respective
assets and the residual value determined by the Company and eachdomestic consolidated subsidiary.
		 Depreciation of property, plant and equipment of the overseas consolidated subsidiaries is calculated principally by the straight-line method
based on the estimated useful lives of the respective assets and the residual value determined by each overseas consolidated subsidiary.
		 The principal estimated useful lives are as follows:		 Buildings and structures 3 to 75 years
		 Machinery and equipment 3 to 22 years		 Significant renewals and additions are capitalized at cost. Maintenanceand repairs are charged to income as incurred.
(h)	Intangible assets included in other assets (other than leased
assets)	Amortization of intangible assets is calculated by the straight-line method.
Capitalized computer software intended for internal use is amortized overits estimated useful life of five years.
(i) Leases
	Leased assets under finance leases are depreciated to their residual valueof zero by the straight-line method using the contract term as the usefullife. Finance leases that do not transfer ownership of the leased assets tothe lessee starting on or before March 31, 2008 are primarily accounted
for as operating leases.
(j) Accrued bonuses for employees	Accrued bonuses for employees of the Company and its domestic consolidated subsidiaries are provided for the current portion of the estimatedamount of bonuses to be paid to the employees in the following year.
(k)	A ccrued bonuses for directors and audit & supervisory board
members	Accrued bonuses for directors and audit & supervisory board members of
the Company is provided for the current portion of the estimated amountof bonuses to be paid to the directors and audit & supervisory board
members in the following year.
(l) Retirement benefits for employees
	Liability for retirement benefits for employees of certain consolidated subsidiaries is provided principally at an amount calculated based on theretirement benefit obligation.

		 The retirement benefit obligation of certain consolidated subsidiaries is
attributed to each year by the straight-line basis over the estimatedremaining years of service of the eligible employees. Prior service cost andactuarial gain or loss incurred at certain consolidated subsidiaries are credited or charged to income in the year in which the gain or loss is recognized.
		 Certain consolidated subsidiaries have adopted a simplified method forthe retirement benefits calculation. Under this simplified method, liability for
retirement benefits is stated at the amount which would be required to be
paid if all eligible employees voluntarily terminated their employment at thebalance sheet date.
(m) Income taxes
	Deferred tax assets and liabilities have been recognized in the accompanying consolidated financial statements with respect to the differences
between the amounts recorded for financial reporting purposes and thetax bases of the assets and liabilities, and were measured using theenacted tax rates and laws which will be in effect when the differences are
expected to reverse.
(n) Deferred assets
Bond issuance costs are charged to expense as incurred.
(o) Research and development costs
Research and development costs are charged to expense as incurred.

(p) Revenues and related costs
	Revenues and the related costs and expenses, except for those from construction contracts, are generally recognized on sales of products at thetime of shipment. The Company recognizes revenue by applying the percentage-of-completion method for the construction projects for which theoutcome of the construction activity is deemed certain at the end of thereporting period. To estimate the progress of such construction projects,
the Company measures the percentage of completion by comparing costs
incurred to date with the most recent estimate of total costs required tocomplete the project (cost to cost basis). For other construction projects
where the outcome cannot be reliably measured, the completed-contract
method is applied.
(q) Derivatives	Derivatives positions are carried at fair value with any changes in unrealized gain or loss charged or credited to income, except for those whichmeet the criteria for deferral hedge accounting under which unrealized gainor loss is deferred and reported as deferred gain or loss on hedges in a
separate component of accumulated other comprehensive income (loss).
(r) Distribution of retained earnings
	
U nder the Corporation Law of Japan (the “Law”), the distribution ofretained earnings with respect to a given fiscal year is made by resolution
at a meeting of the Board of Directors of the Company held subsequent tothe close of such fiscal year. The accounts for that fiscal year do not,therefore, reflect such distributions. (Refer to Note 24.)

3. Accounting Change
Change in Accounting for Business Combinations and Consolidated
Financial Statements
The Company and its domestic consolidated subsidiaries adopted“Accounting Standard for Business Combinations” (Accounting Standards
Board of Japan (“ASBJ”) Statement No.21 revised on September 13, 2013),“Accounting Standard for Consolidated Financial Statements” (ASBJ
Statement No.22 revised on September 13, 2013) and “Accounting Standard
for Business Divestitures” (ASBJ Statement No.7 revised on September 13,2013) effective from April 1, 2015.
With the application of the above standards, any differences resulting fromchanges in ownership interests in its subsidiaries are accounted for aschanges in capital surplus as long as the parent company retains control overits subsidiaries and acquisition related costs are charged to expenses for theperiod in which the costs are incurred and the related services received.
For business combinations occurring on or after April 1, 2015, if the initialaccounting for the business combination has not been completed by the issuance of the consolidated financial statements subsequent to the businesses
combination, provisional amounts are disclosed in the consolidated financial
statements for any items for which the accounting is incomplete. Any adjustments to the provisional amounts based on new information or facts and circumstances are reflected in the consolidated financial statements as if theaccounting for the business combination had been completed at the acquisition date. In addition, the presentation method of net income was amended,and “minority interests” were changed to “non-controlling interests.”

In order to reflect this change in presentation, certain accounts in the prioryear’s consolidated financial statements have been reclassified to conform tothe current period’s presentation.
“Accounting Standard for Business Combinations” and related guidancewere applied in accordance with the transitional treatment specified in Section
58-2(4) of “Accounting Standard for Business Combinations,” Section 44-5(4)of “Accounting Standard for Consolidated Financial Statements,” and Section
57-4(4) of “Accounting Standard for Business Divestitures,” with prospective
application of these accounting standards effective from April 1, 2015.
Cash flow related to the acquisition or sale of shares of a subsidiary by theCompany, where such acquisition or sale would not result in a change in thescope of consolidation, is to be included in “Cash flows from financing activities.”
Cash flow related to the acquisition related costs of shares of a subsidiaryby the Company, where such acquisition would result in a change in the scopeof consolidation and cash flow related to the acquisition or sale related costsof shares of a subsidiary by the Company, where such acquisition or salewould not result in a change in the scope of consolidation, are to be included
in “Cash flows from operating activities.”
These changes had no impact on the consolidated financial statements
and amounts per share for the year ended March 31, 2016.

4. Accounting Standards Issued but Not Yet Effective
Implementation Guidance on Recoverability of Deferred Tax Assets(ASBJ Guidance No.26, March 28, 2016)
On March 28, 2016, the ASBJ issued “Revised Implementation Guidance on
Recoverability of Deferred Tax Assets” (ASBJ Guidance No.26 revised on
March 28, 2016) which basically transferred the accounting guidance includedin the Japanese Institute of Certified Public Accountants Audit Committee
Report No.66 “Audit Treatment on Determining the Recoverability of Deferred
Tax Assets” (JICPA Report No.66) to the ASBJ. The ASBJ basically continues
to apply the framework of the JICPA Report No.66, whereby companies are
categorized into five categories and deferred tax assets are calculated basedon each of these categories. However, the ASBJ conducted a necessary
review regarding the partial accounting treatments for the categorizing criteria
and recoverability of deferred tax assets and established the guidance inapplying “Accounting Standard for Tax Effect Accounting” (BusinessAccounting Council of Japan), regarding the recoverability for deferred tax
assets.
The following accounting treatments for the categorizing criteria and recoverability of deferred tax assets were reviewed and changed:(1)	Classification is clarified for entities that do not meet the criteria for any of
the five categories.

(2)	Criteria for classifying entities as “Category 2” or “Category 3” is changed
from ordinary income to taxable income in the absence of infrequent or
unusual events.
(3)	For “Category 2” entities, deferred tax assets attributable to deductible
temporary differences for which scheduling the timing of the reversals is
not possible are considered to be realizable if certain conditions are met.
Under Audit Committee Report No.66, deferred tax assets are considered
to be realizable to the extent not exceeding the amount based on a scheduling of future reversals of temporary differences.
(4)	For “Category 3” entities, the future period of estimated taxable income
can be estimated in excess of five years if certain conditions are met.
Under Audit Committee Report No.66, the future estimable period is generally limited to five years.
(5)	For entities classified as “Category 4,” they can be treated as “Category 2”
or “Category 3” if certain conditions are met and such entities can use themethods of measurement of deferred tax assets stipulated in “Category 2”
or “Category 3.”
The Company expects to adopt the revised implementation guidance
effective from April 1, 2016.
The Company is currently evaluating the effect of adopting the revised
accounting guidance on the consolidated financial statements.

35

Notes to Consolidated Financial Statements (continued)

5. U.S. Dollar Amounts
The U.S. dollar amounts in the accompanying consolidated financial statements have been translated from yen, solely for convenience and as a matterof arithmetic computation only, at ¥112.62 = U.S.$1.00, the rate of exchange

prevailing on March 31, 2016. This translation should not be construed as arepresentation that the yen amounts have been, could have been, or could in
the future be, converted into U.S. dollars at the above or any other rate.

6. Financial Instruments

36

Status of financial instruments
The Company and its consolidated subsidiaries (collectively, the “Group”) raise
funds principally through the issuance of bonds and loans from banks in consideration of plans for capital expenditures. The Group manages temporary
cash surpluses through highly liquid financial assets. Furthermore, the Group
raises short-term capital through loans from banks. The Group utilizes derivative financial instruments for the purpose of reducing the risk mentioned below
and does not enter into derivative transactions for speculative purposes.
Notes and accounts receivable, trade, are exposed to credit risk in relation
to customers. In addition, the Group is exposed to foreign currency exchange
risk arising from trade receivables denominated in foreign currencies. Shortterm investments and investment securities are exposed to market risk. Those
securities mainly consist of the shares of other companies with which theGroup has business relationships and debt securities through which the Groupmanages temporary cash surpluses.
Substantially all notes and accounts payable have payment due dates
within one year. In addition, the Group is exposed to foreign currency
exchange risk arising from those trade payables denominated in foreign currencies.
The Group conducts varied financing activities to acquire necessary funding for working capital investments in property, plant and equipment, and soforth. Borrowings and bonds with floating interest as a part of such financing
are exposed to the risk of interest rate fluctuation.
Regarding derivative transactions, the Group enters into forward foreignexchange contracts to reduce the foreign currency exchange risk arising fromthe receivables and payables denominated in foreign currencies.
In accordance with the internal policies of the Group for managing credit
risk (risk of non-performance by any of the counterparties) arising from tradereceivables, the Group periodically monitors credit worthiness of customers
and takes prompt action on outstanding balances in order to mitigate thecredit risks. In addition, the Group only acquires held-to-maturity debt securities with high credit ratings.
For trade receivables and payables denominated in foreign currencies, theCompany identifies the foreign currency exchange risk for each currency on amonthly basis and enters into forward foreign exchange contracts to hedge
such risk.
In order to mitigate the unfavorable impact caused by foreign currency
exchange fluctuations on accounts receivable deriving from forecasted export
sales transactions, the Company also enters into forward foreign exchange
contracts to the extent it is probable that those forecasted export sales takeplace.
For short-term investments and investment securities, the Group periodically reviews market prices and the financial position of the issuers who arebusiness counterparties of the Group. In addition, the Group continuously
evaluates whether securities other than those classified as held-to-maturity
debt securities should be maintained taking into account their fair values andrelationships with the counterparty companies.
Derivative transactions are entered into by the division in charge of derivative transactions with the approval from authorized officers in accordance with
the internal policies, which set forth delegation of authority and maximum
upper limit on positions.
In order to manage liquidity risk (the risk that the Group may not be able tomeet its obligations on scheduled due dates) responsible division prepares andupdates its cash flow plans on a timely basis based on reports from each division.
The fair value of financial instruments is based on their quoted market
price, if available. When there is no quoted market price available, fair value isreasonably estimated. Since various assumptions and factors are reflected inestimating the fair value, different assumptions and factors could result in different fair value. In addition, the notional amounts of derivatives in Note 21,“Derivatives” are not necessarily indicative of the actual market risk involved in
the derivative transactions.
Estimated Fair Value of Financial Instruments
Carrying value of financial instruments on the consolidated balance sheet andestimated fair value at March 31, 2016 and 2015 are summarized as follows.
Financial instruments for which it is extremely difficult to determine the fairvalue are not included in the following table.
Carrying
value

2016
Estimated
fair value(Millions of yen)

Assets:Cash and deposits...........................................................................................................................
Notes and accounts receivable, trade..............................................................................................
Short-term investments and investment securities............................................................................
Long-term loans receivable..............................................................................................................
Total assets.........................................................................................................................................

¥104,765
57,57940,61140¥202,995¥104,765
57,57940,61138¥202,993

¥—
—
—
(2)
¥(2)

Liabilities:
Short-term borrowings.....................................................................................................................
Notes and accounts payable, trade..................................................................................................
Notes and accounts payable, other..................................................................................................
Long-term debt, including current portion of long-term debt............................................................
Total liabilities.......................................................................................................................................
Derivative transactions (*).....................................................................................................................

¥20,000
34,66916,96650,128
121,763¥811¥20,000
34,66916,96650,299
121,934
¥811

¥—
—
—
171
171
¥—

DifferenceCarrying
value

2015
Estimated
fair value(Millions of yen)

Assets:Cash and deposits...........................................................................................................................
Notes and accounts receivable, trade..............................................................................................
Short-term investments and investment securities............................................................................
Long-term loans receivable..............................................................................................................
Total assets.........................................................................................................................................

¥106,646
59,65555,63532¥221,968¥106,646
59,65555,63530¥221,966

¥—
—
—
(2)
¥(2)

Liabilities:
Short-term borrowings.....................................................................................................................
Notes and accounts payable, trade..................................................................................................
Notes and accounts payable, other..................................................................................................
Long-term debt, including current portion of long-term debt............................................................
Total liabilities.......................................................................................................................................
Derivative transactions (*).....................................................................................................................

¥22,600
31,882
18,15053,255
125,887¥116¥22,600
31,882
18,15053,388126,020
¥116

¥—
—
—
133
133
¥—

Carrying
value

2016
Estimated
fair value(Thousands of U.S. dollars)

Assets:Cash and deposits........................................................................................................................... $930,256
Notes and accounts receivable, trade..............................................................................................
511,268
Short-term investments and investment securities............................................................................
360,606
Long-term loans receivable..............................................................................................................
351
Total assets......................................................................................................................................... $1,802,481
Liabilities:
Short-term borrowings..................................................................................................................... $177,588
Notes and accounts payable, trade..................................................................................................
307,841
Notes and accounts payable, other..................................................................................................
150,646
Long-term debt, including current portion of long-term loans debt...................................................
445,108
Total liabilities....................................................................................................................................... 1,081,183
Derivative transactions (*)..................................................................................................................... $7,205$930,256
511,268
360,606337$1,802,467

Difference

Difference

$—
—
—
(14)
$(14)

37$177,588
307,841
150,646446,625
1,082,700$7,205

$—
—
—
1,517
1,517
$—

* Assets and liabilities arising from derivatives are presented at net value. The amount in parentheses represents a net liability position.

Methods to determine the estimated fair value of financial instruments are as follows:
Carrying value of cash and deposits, notes and accounts receivable, trade,approximates fair value because these items are settled in a short period oftime.
Regarding short-term investments and investment securities, the fair valueof the shares is based on quoted market prices. The fair value of debt securities is based on either quoted market prices or prices provided by financial
institutions.
For information on securities classified by holding purpose, please refer toNote 7, “Short-Term Investments and Investment Securities.”
Fair value of long-term loans receivable, classified by the maturity and current credit risk of each loan, is based on the present value of the total of principal and interest discounted by the interest rate determined taking into accountthat of Japanese government bonds and the credit spreads of each loan. The
fair value in the table above includes the current portion of long-term loans
receivable.
Carrying value of short-term borrowings and notes and accounts payable,
trade and other approximates fair value because these items are settled in ashort period of time.
The fair value of long-term debt is based on the present value of the total ofprincipal and interest discounted by the interest rate to be applied if similar
new borrowings were entered into. The fair value in the table above includes
the current portion of long-term loans debt.
Regarding fair value of derivatives, please refer to Note 22, “Derivatives.”

Carrying value of financial instruments for which it is extremely difficult to determine the fair value at March 31, 2016 and 2015 was as follows:

2016

2015

Thousands of
U.S. dollars
2016¥1,649¥1,849$14,638

Millions of yen

Unlisted equity securities......................................................................................................................

Notes to Consolidated Financial Statements (continued)

Redemption schedules for monetary assets at March 31, 2016 and 2015 were as follows:
2016

Within 1 year

Over 1 year
within 5 years

Over 5 years
within 10 years

Over 10 years(Millions of yen)

Cash and deposits.............................................................................................
Notes and accounts receivable, trade.................................................................
Long-term loans receivable.................................................................................
Total...................................................................................................................

¥104,765
57,579—¥162,344

¥—
—
29
¥29

Within 1 year

Over 1 year
within 5 years

¥—
—
11
¥11

¥—
—
—
¥—

Over 5 years
within 10 years

Over 10 years

2015(Millions of yen)

Cash and deposits.............................................................................................
Notes and accounts receivable, trade.................................................................
Long-term loans receivable.................................................................................
Total...................................................................................................................

¥106,646
59,655—¥166,301

¥—
—
20
¥20

Within 1 year

Over 1 year
within 5 years

¥—
—
12
¥12

¥—
—
—
¥—

Over 5 years
within 10 years

Over 10 years

2016(Thousands of U.S. dollars)

Cash and deposits.............................................................................................
Notes and accounts receivable, trade.................................................................
Long-term loans receivable.................................................................................
Total...................................................................................................................

$930,256
511,268—$1,441,524

$—
—
260
$260

$—
—
91
$91

$—
—
—
$—

7. Short-Term Investments and Investment Securities

38(a) Marketable securities classified as other securities at March 31, 2016 and 2015 are summarized as follows:

Acquisition cost

Securities whose market value reflected in the balance sheet
exceeds their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Securities whose market value reflected in the balance sheet
does not exceed their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Total....................................................................................................................................................

Difference¥18,629—
18,629¥36,090—
36,090¥17,461—
17,461

1,403
3,200
4,603
¥23,232

1,321
3,200
4,521
¥40,611

(82)
—
(82)
¥17,379

Acquisition cost

Securities whose market value reflected in the balance sheet
exceeds their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Securities whose market value reflected in the balance sheet
does not exceed their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Total....................................................................................................................................................

2016Market value
reflected in thebalance sheet(Millions of yen)

2015
Market value
reflected in thebalance sheet(Millions of yen)

Difference¥20,335—
20,335¥50,434—
50,434¥30,098—
30,098

4
5,198
5,202
¥25,537

3
5,198
5,201
¥55,635(1)—(1)¥30,098

Acquisition cost

Securities whose market value reflected in the balance sheet
exceeds their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Securities whose market value reflected in the balance sheet
does not exceed their acquisition cost:
Equity securities...............................................................................................................................
Other...............................................................................................................................................
Subtotal....................................................................................................................................
Total....................................................................................................................................................
Unlisted equity securities (recorded in the accompanying consolidated balance
sheet in the amounts of ¥1,649 million ($14,638 thousand) and ¥1,849 million
at March 31, 2016 and 2015, respectively) are not included in the table above
because there were no quoted market prices available and it is extremely difficult to determine the fair value.
The Company and certain domestic consolidated subsidiaries have recognized losses on devaluation of investment securities classified as other securi-

2016
Market value
reflected in thebalance sheet(Thousands of U.S. dollars)

Difference$165,416—
165,416$320,458—
320,458$155,042—
155,042

12,462
28,41140,873$206,289

11,73728,41140,148$360,606

(725)
—
(725)
$154,317

ties of ¥3 million ($23 thousand) and ¥1 million for the years ended March 31,
2016 and 2015, respectively.
Loss on devaluation of investment securities are recorded for the securities
whose market value represents a substantial decline of 50% or more and for
those which have declined within a range of 30% or more, but less than 50% if
the decline is deemed to be irrecoverable.

(b) The proceeds from sales of, and gross realized gain and loss on, other securities for the years ended March 31, 2016 and 2015 are summarized as follows:
2016
Gross realized
gain(Millions of yen)

Proceeds

Equity securities..................................................................................................................................
Other...................................................................................................................................................
Total....................................................................................................................................................

¥ 649
4,001
¥4,650¥2,194—¥2,1942015
Gross realized
gain(Millions of yen)

Proceeds

Equity securities..................................................................................................................................
Other...................................................................................................................................................
Total....................................................................................................................................................

¥0
10,000¥10,000

Proceeds

Equity securities..................................................................................................................................
Other...................................................................................................................................................
Total....................................................................................................................................................

¥—
—
¥—
2016
Gross realized
gain(Thousands of U.S. dollars)$5,769
35,524$41,293$19,478—$19,478

Gross realized
loss

¥0
—
¥0
Gross realized
loss

¥—
—
¥—
Gross realized
loss

$0
—
$0

8. Short-Term Borrowings and Long-Term Debt
Short-term borrowings and the current portion of long-term debt at March 31, 2016 and 2015 consisted of the following:

2016

2015

Thousands of
U.S. dollars
2016¥20,000
25,065¥45,065¥22,600
3,065¥25,665$177,588
222,565$400,153

Millions of yen

Short-term borrowings........................................................................................................................
Current portion of long-term debt........................................................................................................

The weighted-average annual interest rates applicable to short-term borrowings outstanding at March 31, 2016 and 2015 were 0.22% and 0.49%, respectively.

39

Notes to Consolidated Financial Statements (continued)

Long-term debt at March 31, 2016 and 2015 consisted of the following:

2016

2015

Thousands of
U.S. dollars
2016¥10,128
15,00025,000¥50,128(25,065)¥25,063¥13,255
15,00025,000¥53,255(3,065)¥50,190$89,931
133,191
221,986$445,108(222,565)$222,543

Millions of yen

Debt without collateral:
Loans from banks due April 2017 through March 2018, at average interest rates
of 0.30% and 0.70% per annum at March 31, 2016 and 2015, respectively....................................
Bonds in yen due September 2016 at rate of 0.495%......................................................................
Bonds in yen due April 2019 at rate of 0.294%................................................................................
Subtotal...........................................................................................................................................
Less current portion.............................................................................................................................

The aggregate annual maturities of long-term debt subsequent to March 31, 2016 are summarized as follows:Year ending March 31,
2017.........................................................................................................................................................................
2018.........................................................................................................................................................................
2019.........................................................................................................................................................................
2020.........................................................................................................................................................................
2021 and thereafter...................................................................................................................................................

Millions of yen

Thousands of
U.S. dollars¥25,06557
6
25,000—¥50,128$222,565
506
51
221,986—$445,108

Millions of yen

Thousands of
U.S. dollars

9. Assets Pledged as Collateral
Assets pledged as collateral for accounts payable of ¥91 million ($807 thousand) at March 31, 2016 were as follows:

Investment securities....................................................................................................................................................

¥8

$74

40
10. Lease Obligations
The aggregate annual maturities of lease obligations subsequent to March 31, 2016 are summarized as follows:Year ending March 31,
2017.........................................................................................................................................................................
2018.........................................................................................................................................................................
2019.........................................................................................................................................................................
2020.........................................................................................................................................................................
2021 and thereafter...................................................................................................................................................

Millions of yen

¥145
71
16
11
3
¥246

Thousands of
U.S. dollars$1,285
625
144
100
30
$2,184

11. Retirement Benefits
The Company and certain domestic consolidated subsidiaries have defined
contribution plans for retirement benefits. Other domestic consolidated subsidiaries have defined benefit plans, including lump-sum payment plans, covering

substantially all employees who are entitled to lump-sum or annuity payments,
the amounts of which are determined by reference to their basic rates of pay,
length of service, and the conditions under which termination occurs.

Certain consolidated subsidiaries calculate the liability for retirement benefits based on the simplified method.
The changes in the retirement benefit obligation for the years ended March 31, 2016 and 2015 are summarized as follows (excluding retirement benefit obligations
based on the simplified method):
Millions of yen
2016

Retirement benefit obligation at the beginning of the year....................................................................
Service cost.........................................................................................................................................
Interest cost........................................................................................................................................
Foreign currency translation difference.................................................................................................
Others.................................................................................................................................................
Retirement benefit obligation at the end of the year.............................................................................

¥495
26
9
(9)
(64)
¥457

2015

¥491
29
13
(42)
4
¥495

Thousands of
U.S. dollars
2016$4,398
234
76
(78)
(573)
$4,057

The changes in the retirement benefit obligation under the simplified method for the years ended March 31, 2016 and 2015 are summarized as follows:
Millions of yen
2016

Retirement benefit obligation at the beginning of the year....................................................................
Service cost.........................................................................................................................................
Benefit paid.........................................................................................................................................
Retirement benefit obligation at the end of the year.............................................................................

2015

¥9
4
(5)
¥8

Thousands of
U.S. dollars
2016

$81
33
(44)
$70

¥12
0
(3)
¥ 9

The balance of retirement benefit obligation and plan assets at fair value at March 31, 2016 and 2015 and liabilities recognized in the consolidated balance sheet atMarch 31, 2016 and 2015 are summarized as follows:
Millions of yen
2016

Unfunded retirement benefit obligation*...............................................................................................
Net amount of liabilities and assets recognized in consolidated balance sheet.....................................
Liability for retirement benefits..............................................................................................................
Asset for retirement benefits................................................................................................................
Net amount of liabilities and assets recognized in consolidated balance sheet.....................................

2015

¥465
465
465
—
¥465

¥504
504
504
—
¥504

Thousands of
U.S. dollars
2016$4,127
4,127
4,127
—
$4,127* Certain domestic consolidated subsidiaries have calculated their retirement benefit obligation based on the simplified method.

The components of retirement benefit expenses for the years ended March 31, 2016 and 2015 are summarized as follows:
Millions of yen
2016

Service cost.........................................................................................................................................
Interest cost........................................................................................................................................
Amortization of actuarial (gain) loss......................................................................................................
Retirement benefit expenses................................................................................................................

2015

¥30
9
(26)
¥13

Thousands of
U.S. dollars
2016

$267
76
(228)
$115

¥29
13
4
¥46

41

The actuarial assumption used in accounting for the above plans was as follows:
2016

Discount rates..........................................................................................................................................................

1.9%

2015

2.8%

The required contributions to defined contribution plans of the Company and certain consolidated subsidiaries were ¥1,581 million ($14,038 thousand) and ¥1,665
million for the years ended March 31, 2016 and 2015, respectively.

12. Income Taxes
Income taxes in Japan applicable to the Company and its domestic consolidated subsidiaries consist of corporation tax, inhabitants’ taxes and enterprisetaxes, which, in the aggregate, resulted in statutory tax rates of approximately

32.3% and 34.8% for the years ended March 31, 2016 and 2015, respectively.
Income taxes of the overseas consolidated subsidiaries are based generally on
the tax rate applicable in their respective countries of incorporation.

The effective tax rates for the years ended March 31, 2016 and 2015 differed from the statutory tax rates for the following reasons:Statutory tax rates....................................................................................................................................................
Effect of:
Elimination of dividend income received from overseas
consolidated subsidiaries.....................................................................................................................................
Permanently non-deductible expenses..................................................................................................................
Tax effect of retained earnings in overseas consolidated subsidiaries.....................................................................
Income taxes refunded..........................................................................................................................................
Change in statutory income tax rate......................................................................................................................
Difference between statutory tax rate in Japan and income tax rates
applied at overseas consolidated subsidiaries......................................................................................................
Tax credits.............................................................................................................................................................
Permanently non-taxable dividends received.........................................................................................................
Valuation allowance...............................................................................................................................................
Other, net..............................................................................................................................................................
Effective tax rates.....................................................................................................................................................
The “Act for Partial Amendment of the Income Tax Act, etc.” and the “Act for
Partial Amendment of the Local Tax Act, etc.” were enacted on March 29,
2016.
In line with these revisions, the statutory tax rates used in the calculation ofdeferred tax assets and deferred tax liabilities changed from 31.5% to 30.1%
for temporary differences expected to be realized during the period from April

2016

2015

32.3%

34.8%

27.6
2.3
(2.6)
(18.6)
4.3

2.5
0.8
1.2
—
2.6

(17.1)(12.8)(27.3)
43.8
4.1
36.0%

(5.7)
(4.1)
(3.1)
3.7
2.2
34.9%

1, 2016 to March 31, 2018, and to 29.9% for temporary differences expected
to be realized from April 1, 2018.
As a result of these changes in statutory tax rates, net deferred tax assets(after netting with deferred tax liabilities) decreased by ¥521 million ($4,625
thousand) and income taxes-deferred increased by ¥521 million ($4,625 thousand) as of and for the year ended March 31, 2016.

Notes to Consolidated Financial Statements (continued)

The significant components of deferred tax assets and liabilities at March 31, 2016 and 2015 were as follows:
Millions of yen

Deferred tax assets:
Depreciation.....................................................................................................................................
Tax loss carryforwards......................................................................................................................
Accrued bonuses.............................................................................................................................
Intercompany profit on sales of property, plant and equipment.........................................................
Loss on devaluation of investment securities....................................................................................
Loss on devaluation of inventories....................................................................................................
Loss on impairment of fixed assets..................................................................................................
Provision for doubtful accounts........................................................................................................
Other...............................................................................................................................................
Gross deferred tax assets....................................................................................................................
Less: valuation allowance..........................................................................................................
Total deferred tax assets......................................................................................................................
Deferred tax liabilities:
Net unrealized holding gain on other securities.................................................................................
Net unrealized gain on land revaluation resulting from inclusion of
a subsidiary in consolidation............................................................................................................
Reserve for depreciation for tax purposes........................................................................................
Tax effect of retained earnings in overseas consolidated subsidiaries................................................
Surplus arising from land revaluation................................................................................................
Total deferred tax liabilities...................................................................................................................
Net deferred tax liabilities.....................................................................................................................

42

Thousands of
U.S. dollars
2016

2016

2015

¥3,508
719
1,101
576
638
458
305
100
1,243
8,648
(2,978)5,670¥3,430
915
1,259
706
695
465
706
232
983
9,391
(3,003)6,388$31,148
6,380
9,778
5,119
5,666
4,068
2,709
885
11,04076,793(26,445)
50,348(4,584)(8,862)(40,698)

(741)
(42)
(1,097)(68)(6,532)¥(862)(741)(49)(1,409)(72)(11,133)¥(4,745)(6,579)(376)(9,741)(607)(58,001)$(7,653)

13. Shareholders’ Equity
The Law provides that an amount equal to 10% of the amount to be disbursed
as distributions of capital surplus (other than the capital reserve) and retained
earnings (other than the legal reserve) be transferred to the capital reserve andthe legal reserve, respectively, until the sum of the capital reserve and the legal
reserve equals 25% of the capital stock account. Such distributions can bemade at any time by resolution of the shareholders, or by the Board of
Directors if certain conditions are met.
Retained earnings include the legal reserve provided in accordance with
the Law. The legal reserve of the Company included in retained earnings at

March 31, 2016 and 2015 amounted to ¥3,548 million ($31,510 thousand)and ¥3,548 million, respectively.
The Law further provides that, in general, an amount equal to the entire
amount of the paid-in capital for new share issuances be transferred to thecommon stock account; however, an amount equal to or less than 50% of theentire amount may be transferred to the capital surplus account.

Treasury stock
Movements in treasury stock during the years ended March 31, 2016 and 2015 are summarized as follows:
Number of shares
2016

Treasury stock:
Common stock.............................................................................

March 31, 2015

Increase

Decrease

March 31, 2016

12,775,618

5,002,661

10,000,000

7,778,279

Number of shares
2015

March 31, 2014
Treasury stock:
Common stock.............................................................................

12,771,301

The increase in treasury stock (5,002,661 common shares) for the year ended
March 31, 2016 was due to the purchase of 5,000,000 shares on the Tokyo
Stock Exchange based on the resolution of the Board of Directors’ meeting
held on October 30, 2015, and the purchase of 2,661 fractional shares.

Increase

Decrease

2,377

60

March 31, 2015
12,775,618

The decrease of 10,000,000 common shares for the year ended March 31,
2016 was due to retirement of treasury stock.

14. Loss on Impairment of Fixed Assets
Fixed assets are grouped based on business segments. The carrying values of
the idle assets which are not anticipated to be utilized in the future and whosemarket values decreased from their carrying values have been reduced to theirrespective recoverable amounts.

Losses on impairment of fixed assets for the years ended March 31, 2016 and 2015 are summarized as follows:
2016

Millions of yen

Thousands of
U.S. dollars

Idle

¥79

$705

Idle

¥14

$122

Idle

¥37

$324

Idle

¥10

$92

Idle

¥654

$5,804

Idle

¥72

$642

Idle

¥237

$2,106

Idle¥5,297$47,038

Idle

¥3

$23

Location
Ogaki City,
Gifu Prefecture
Ogaki City,
Gifu Prefecture
Thessaloniki,Hellenic Republic
Thessaloniki,Hellenic Republic
Batangas, Republicof Philippines
Courtenay,
FrancePenang,Malaysia
Penang,Malaysia
Penang,Malaysia

Classification
Buildings andstructures
Construction inprogress
Buildings andstructures

Description

Land

Location
Godo Town,
Gifu Prefecture
Godo Town,
Gifu Prefecture
Godo Town,
Gifu Prefecture
Beijing, People’s
Republic of China
Thessaloniki,Hellenic Republic

Classification
Buildings andstructures
Machinery andequipment

Description

Construction inprogress
Machinery andequipment
Machinery andequipment
Construction inprogress
Other
2015

Millions of yen

Idle¥ 594Idle¥ 199Others

Idle

¥

0

Machinery andequipment

Idle

¥

13

Land

Idle

¥

26

The recoverable amounts were measured at estimated net selling value. The carrying values of idle assets have been reduced to ¥1 ($0.01) for the years ended
March 31, 2016 and 2015, respectively.

43

Notes to Consolidated Financial Statements (continued)

15. Temporarily Unutilized Property and Equipment
The following property and equipment included in property, plant and equipment in the accompanying consolidated balance sheet are temporarily unutilized at
March 31, 2016 and 2015.

2016

2015

Thousands of
U.S. dollars
2016¥19,634
25,538372¥5,012
6,095
154$174,342
226,759
3,305

Millions of yen

Buildings and structures......................................................................................................................
Machinery and equipment...................................................................................................................
Other...................................................................................................................................................

16. Land Revaluation
A consolidated subsidiary revalued its land held for business use in accordance with the “Land Revaluation Law” and the amended “Land Revaluation
Law” at March 31, 2002. As a result, the consolidated subsidiary recognized again on land revaluation and recorded a deferred tax liability related to thisgain. The resulting gain, net of the relevant tax effect, has been accounted forunder accumulated other comprehensive income (loss) as surplus arising fromland revaluation. The method followed for this land revaluation was determinedin accordance with the “Land Valuation Tax Law” as stipulated in the“Enforcement Act Concerning Land Revaluation” and other regulations.
As of March 31, 2016, the fair value of this land was ¥304 million ($2,699
thousand) less than its carrying value after revaluation.

17. Selling, General and Administrative Expenses
The components of selling, general and administrative expenses for the years ended March 31, 2016 and 2015 were as follows:

2016

2015

Thousands of
U.S. dollars
2016¥11,780
1,151
69
221
15,204
24,777¥53,202¥12,344929
167
303
15,512
25,536¥54,791$104,602
10,221613
1,965
134,997
220,008$472,406

2016

2015

Thousands of
U.S. dollars
2016¥ 2,194(3)(3,923)(6,403)
1,099(4,065)(6)—(202)¥(11,309)

¥—
(1)
(982)
(832)
5,769
(1,241)
(25)
353
(296)
¥2,745$19,478(23)(34,832)(56,856)
9,757(36,098)(53)—(1,786)$(100,413)

Millions of yen

44

Salaries...............................................................................................................................................
Provision for employees’ bonuses.......................................................................................................
Provision for directors’ and audit & supervisory board members’ bonuses...........................................
Provision for employees’ retirement benefit expenses..........................................................................
Research and development costs........................................................................................................
Other...................................................................................................................................................
Total....................................................................................................................................................

18. Other Income (Expenses)
The components of “Other, net” in “Other income (expenses)” for the years ended March 31, 2016 and 2015 were as follows:
Millions of yen

Gain on sales of investment securities.................................................................................................
Loss on devaluation of investment securities ......................................................................................
Loss on sales and disposal of property and equipment, net.................................................................
Loss on impairment of fixed assets......................................................................................................
Foreign exchange gain, net..................................................................................................................
Depreciation of inactive fixed assets....................................................................................................
Loss on liquidation of subsidiaries and affiliates...................................................................................
Gain on reversal of stock acquisition rights..........................................................................................
Other, net............................................................................................................................................
Total....................................................................................................................................................

19. Amounts per Share
Yen

Basic profit attributable to owners of parent.........................................................................................
Net assets...........................................................................................................................................
Cash dividends applicable to the year..................................................................................................
Basic profit attributable to owners of parent per share for the years ended
March 31, 2016 and 2015 has been computed based on the profit attributable
to the shareholders of common stock and the weighted-average number ofshares of common stock outstanding during the year. Amounts per share of
net assets have been computed based on the number of shares of common
stock outstanding at the year end.

2016

2015

¥55.292,459.63
35.00¥138.37
2,578.85
35.00

U.S. dollars
2016$0.4921.84
0.31

Cash dividends per share represent the cash dividends approved by the
Board of Directors as applicable to the respective years together with theinterim cash dividends paid.

Financial data for the computation of basic profit attributable to owners of parent per share for the years ended March 31, 2016 and 2015 in the table above issummarized as follows:
Millions of yen

Profit attributable to owners of parent..................................................................................................

2016

2015

¥7,531¥19,107

Thousands of
U.S. dollars
2016$66,870

Thousands of shares

Weighted-average number of shares of common stock outstanding during the year............................

2016

2015

136,209

138,086

Financial data for the computation of net assets per share at March 31, 2016 and 2015 in the above table is summarized as follows:

2016

2015

Thousands of
U.S. dollars
2016¥331,521¥360,092$2,943,713(4,188)¥327,333(3,991)¥356,101(37,183)$2,906,530

Millions of yen

Total net assets...................................................................................................................................
Deductions from total net assets:
Non-controlling interests..................................................................................................................
Total net assets attributable to common stockholders.........................................................................

Thousands of shares

Number of shares of common stock used in the calculation of net assets per share............................

2016

2015

133,082

138,08445

Notes to Consolidated Financial Statements (continued)

20. Other Comprehensive Income
The following table presents reclassification adjustments and tax effects for other comprehensive income (loss) for the years ended March 31, 2016 and 2015:
Thousands of
U.S. dollars
2016

Millions of yen

Net unrealized holding (loss) gain on securities:
Amount arising during the year.........................................................................................................
Reclassification adjustments for gain realized in the statement of income.........................................
Before tax effect...............................................................................................................................
Tax effect.........................................................................................................................................
Net unrealized holding (loss) gain on securities....................................................................................
Deferred gain (loss) on hedges:
Amount arising during the year.........................................................................................................
Reclassification adjustments for loss realized in the statement of income.........................................
Before tax effect...............................................................................................................................
Tax effect.........................................................................................................................................
Deferred gain (loss) on hedges.............................................................................................................
Surplus arising from land revaluation:
Tax effect.........................................................................................................................................
Surplus arising from land revaluation:
Translation adjustments:
Amount arising during the year.........................................................................................................
Reclassification adjustments for (gain) loss realized in the statement of income................................
Translation adjustments.......................................................................................................................
Total....................................................................................................................................................

2016

2015

¥(10,526)(2,193)(12,719)
4,169(8,550)¥12,274—
12,274(2,648)9,626$ (93,461)(19,477)(112,938)
37,018(75,920)

283
2
285
(86)
199

(1)
—
(1)
0
(1)

2,513
17
2,530
(763)
1,767

3
3

85
85

32
32

(12,673)(984)(13,657)¥(22,005)

13,02839
13,067¥22,777(112,525)(8,739)(121,264)$(195,385)

21. Supplementary Cash Flow Information46

A reconciliation of cash and cash equivalents in the accompanying consolidated statement of cash flows and cash and deposits in the accompanying consolidatedbalance sheet is presented as follows:

2016

2015

Thousands of
U.S. dollars
2016¥104,765
3,200(90)¥107,875¥106,646
5,197(1,364)¥110,479$930,256
28,411(796)$957,871

Millions of yen

Cash and deposits..............................................................................................................................
Short-term investments.......................................................................................................................
Time deposits with maturities in excess of three months......................................................................
Cash and cash equivalents..................................................................................................................

22. Derivatives
Derivative financial instruments such as forward foreign exchange contracts
are utilized by the Company principally in order to manage the risk arising fromadverse fluctuation in foreign currency exchange rates. The Company has
established a control environment which includes policies and procedures forrisk assessment, including an assessment of the effectiveness of hedging, andfor the approval, reporting and monitoring of transactions involving derivatives.
The Company does not hold or issue derivatives for speculative purposes.
The Company is exposed to certain market risk arising from forward foreign exchange contracts. The Company is also exposed to the risk of credit

loss in the event of non-performance by any of the counterparties to forward
foreign exchange contracts; however, the Company does not anticipate nonperformance by any of these counterparties, all of whom are financial institutions with high credit ratings.
Summarized below are the notional amounts and estimated fair value ofthe derivatives positions outstanding at March 31, 2016 and 2015, for which
hedge accounting has not been applied. There were no derivatives with maturities over one year at March 31, 2016 and 2015.

Notional
amountForward foreign exchange contracts:
Sell:
U.S. dollars...................................................................................................................................
Euros............................................................................................................................................
Total....................................................................................................................................................

¥3,8784,369¥8,247

Notional
amountForward foreign exchange contracts:
Sell:
U.S. dollars...................................................................................................................................
Euros............................................................................................................................................
Total....................................................................................................................................................

¥1,815
1,405¥3,2202016
Estimated
fair value(Millions of yen)

¥276
252
¥528
2015
Estimated
fair value(Millions of yen)

¥13
103
¥116

Unrealized
gain

¥276
252
¥528

Unrealized
gain

¥13
103
¥116

2016
Estimated
fair value(Thousands of U.S. dollars)

Notional
amountForward foreign exchange contracts:
Sell:
U.S. dollars...................................................................................................................................
Euros............................................................................................................................................
Total.................................................................................

$34,433
33,536$67,969

Unrealized
gain$2,456
2,237$4,693$2,456
2,237$4,693

Summarized below are the notional amounts and estimated fair value of the derivatives positions outstanding at March 31, 2016 for which hedge accounting has
been applied.
Method ofhedge
accounting

Deferral hedge
accounting

2016

Transaction

Hedged item

Forward foreignexchange contracts:
Sell:
Euros

Accounts
receivable

Notional amount(Millions of yen)

Estimated
fair value¥3,178¥283

There were no derivatives with maturities over one year at March 31, 2016.
Method ofhedge
accounting

Deferral hedge
accounting

2016

Transaction

Hedged item

Forward foreignexchange contracts:
Sell:
Euros

Accounts
receivable

Estimated
fair value(Thousands of U.S. dollars)

Notional amount47$28,215$2,513

Estimated fair value is based on the prices obtained from financial institutions.

23. Segment Information
Overview of reportable segments
The reportable segments of the Group are components for which discrete
financial information is available and whose operating results are regularly
reviewed by the Company’s Board of Directors to make decisions about
resource allocation and to assess the business performances of those segments.
The Group classifies the Company and its subsidiaries identified by therespective products and services they provide. Each company plans comprehensive domestic and overseas strategies for its products and conducts
related business activities.
Based on the Group’s primary business activities, the reportable segments
include “Electronics” and “Ceramics.” The main products or services of thosesegments are as follows:
Electronics segment:		This reportable segment includes the business of manufacturing andsales of printed wiring boards and package substrates.
Ceramics segment:		This reportable segment includes the business of manufacturing andsales of environment-related ceramics products, graphite specialty products, fine ceramics products and ceramics fiber.

The reportable segments formerly classified as “Housing materials” and“Construction” in previous years were included in “Other” because these segments became immaterial during the year ended March 31, 2016. The segment information for the year ended March 31, 2015 has been restated toreflect these changes.
Method of calculating sales, income (loss), assets and other items for thereportable segments
The method of accounting for reportable segments is the same as describedin Note 2. “Summary of Significant Accounting Policies.” The income of reportable segments is calculated on the basis of operating income in the consolidated statement of income. Intersegment sales are basically recorded at same
prices used in transactions with third parties.

A summary of net sales, income, assets and other items by reportable segment for the years ended March 31, 2016 and 2015 is as follows:
Millions of yen
2016
Reportable Segments

Sales to third parties.................................................
Inter-segment sales and transfers.............................
Net sales..................................................................
Segment income......................................................
Segment assets........................................................
Depreciation and amortization..................................
Increase in property,
plant and equipment and intangible assets..............

Electronics

Ceramics

Total

Other

Total

Adjustment

Consolidated
Financial
Statements¥147,872
23¥147,895¥11,472
121,260
31,332¥104,768
148¥104,916¥5,914103,558
9,501¥252,640
171¥252,811¥17,386
224,818
40,833¥61,479
8,654¥70,133¥5,156
67,0261,830¥314,1198,825¥322,944¥22,542
291,844
42,663¥—(8,825)¥(8,825)¥29
184,266
1,394¥314,119—¥314,119¥22,571
476,11044,057

21,384

14,58735,971

7,124

43,095448

43,543

Notes to Consolidated Financial Statements (continued)

Millions of yen
2015
Reportable Segments

Sales to third parties.................................................
Inter-segment sales and transfers.............................
Net sales..................................................................
Segment income......................................................
Segment assets........................................................
Depreciation and amortization..................................
Increase in property,
plant and equipment and intangible assets..............

Electronics

Ceramics

Total

Other

Total

Adjustment

Consolidated
Financial
Statements¥159,850
2¥159,852¥ 14,168
140,31227,350¥ 99,191
144¥ 99,335¥ 6,348
100,9908,648¥259,041
146¥259,187¥ 20,516
241,30235,998¥59,0318,064¥67,095¥ 5,393
60,716
1,748¥318,072
8,210¥326,282¥ 25,909
302,018
37,746¥—(8,210)¥(8,210)¥130
217,829
1,682¥318,072—¥318,072¥26,039
519,847
39,42848,256

8,237

56,493

1,334

57,8271,303

59,130Thousands of U.S. dollars
2016
Reportable Segments

48

Electronics

Ceramics

Total

Other

Total

Adjustment

Consolidated
Financial
Statements

Sales to third parties................................................. $1,313,019
Inter-segment sales and transfers.............................
205
Net sales.................................................................. $1,313,224
Segment income...................................................... $101,861
Segment assets........................................................ 1,076,718
Depreciation and amortization..................................
278,212
Increase in property,
plant and equipment and intangible assets..............
189,878$930,274
1,310$931,584$52,506
919,536
84,364$2,243,293
1,515$2,244,808$154,367
1,996,254
362,576$545,902
76,842$622,744$45,785
595,152
16,246$2,789,195
78,357$2,867,552$200,152
2,591,406
378,822$—(78,357)$(78,357)$262
1,636,177
12,378$2,789,195—$2,789,195$200,414
4,227,583
391,200

129,525

319,403

63,263382,666

3,981

386,647

Other in the above table includes housing materials, construction, the manufacturing of foamed-resin products, processing of agricultural and marine products,
operations of gas stations and software development, network design and construction that are not included in a reportable segment.
The adjustments of segment income in the amount of ¥29 million ($262 thousand) and ¥130 million for the years ended March 31, 2016 and 2015, respectively, are elimination of intersegment transactions.
Segment income corresponds to operating income in the consolidated statement of income.
Related information
Geographical information
Net sales to third parties by countries or areas grouped according to geographical classification for the years ended March 31, 2016 and 2015 are summarized as follows:

2016

2015

Thousands of
U.S. dollars
2016¥ 85,160
146,330
16,75365,875
1¥314,119¥ 75,186
174,369369
61,266
6,882¥318,072$756,175
1,299,327
148,753584,9319$2,789,195

2016

2015

Thousands of
U.S. dollars
2016¥ 74,867
96,958
7,813
36,290¥215,928¥ 72,879
123,320
7,744
32,211¥236,154$664,777
860,930
69,381
322,232$1,917,320

Millions of yen

Japan..................................................................................................................................................
Asia (excluding Japan).........................................................................................................................
North America.....................................................................................................................................
Europe................................................................................................................................................
Other...................................................................................................................................................
Consolidated.......................................................................................................................................

Property, plant and equipment by countries or geographical areas at March 31, 2016 and 2015 are summarized as follows:
Millions of yen

Japan..................................................................................................................................................
Asia (excluding Japan).........................................................................................................................
North America.....................................................................................................................................
Europe................................................................................................................................................
Consolidated.......................................................................................................................................
Major customer information
Sales to a major customer for the years ended March 31, 2016 and 2015 are as follows:

Customer Name

2016

2015

Thousands of
U.S. dollars
2016Intel Corp............................................................................................................................................

¥65,738¥73,985$583,712

Millions of yen

Loss on impairment of fixed assets
Loss on impairment of fixed assets by reportable segment for the years ended March 31, 2016 and 2015 are summarized as follows:
Millions of yen
2016
Reportable Segments
Electronics

Loss on impairment of fixed assets........

¥—

Ceramics

Total

¥—

Other

¥—

Total

¥—

Corporate andElimination

Consolidated
Financial
Statements¥6,403¥6,403

Corporate andElimination

Consolidated
Financial
Statements

¥832

¥832

Corporate andElimination

Consolidated
Financial
Statements$56,856$56,856¥—

Millions of yen
2015
Reportable Segments
Electronics

Loss on impairment of fixed assets........

¥—

Ceramics

Total

¥—

Other

¥—

Total

¥—

¥—

Thousands of U.S. dollars
2016
Reportable Segments
Electronics

Loss on impairment of fixed assets........

$—

Ceramics

Total

$—

Other

$—

Total

$—

$—

Amortization amount and remaining balance of goodwill
Amortization amount and remaining balance of goodwill by reportable segment for the years ended and as of March 31, 2016 and 2015 are summarized as follows:
Millions of yen
2016
Reportable Segments
Electronics

Goodwill:
Amortization amount..........................
Remaining balance.............................

¥——

Ceramics¥1,011
1,216

Total

Other

¥1,011
1,216

¥—
—

Total

Corporate andElimination

Consolidated
Financial
Statements¥——¥1,011
1,216

Corporate andElimination

Consolidated
Financial
Statements¥——¥1,0562,237

Corporate andElimination

Consolidated
Financial
Statements$——$ 8,973
10,797¥1,011
1,216

Millions of yen
2015
Reportable Segments
Electronics

Goodwill:
Amortization amount..........................
Remaining balance.............................

¥——

Ceramics¥1,056
2,237

Total

Other

¥1,056
2,237

¥—
—

Total

¥1,056
2,237

Thousands of U.S. dollars
2016
Reportable Segments
Electronics

Goodwill:
Amortization amount..........................
Remaining balance.............................

$——

Ceramics$ 8,973
10,797

Total$ 8,973
10,797

Other

$—
—

Total

$ 8,973
10,797

24. Subsequent Event
Cash dividends
The following distribution of retained earnings of the Company, which has not been reflected in the accompanying consolidated financial statements for the year
ended March 31, 2016, was approved at a meeting of the Board of Directors held on May 16, 2016:

Year-end cash dividends(¥20 = ($0.18) per share)...........................................................................................................................................

Millions of yen

Thousands of
U.S. dollars¥2,661$23,633

49

Report of Independent Auditors

50

Group Companies

Domestic Base

Global BaseIBIDEN Greentec Co., Ltd.
3-55, Gama-cho, Ogaki, Gifu 503-0021, Japan
Tel: 0584-81-6111

NORTH AMERICAASIAIBIDEN U.S.A. Corp. (Head Office)3900 Freedom Circle #130 Santa Clara,
CA 95054, U.S.A.
Tel: +1-408-991-9801

IBIDEN Electronics (Beijing) Co., Ltd.
15#, Rongchang East Street, BDA, Beijing 100176, P.R.C.
Tel: +86-10-6788-2288

IBIDEN Chemical Co., Ltd.
300, Aoyanagi-cho, Ogaki, Gifu 503-8503, Japan
Tel: 0584-89-7491
IBIKEN Co., Ltd.
1-60, Gama-cho, Ogaki, Gifu 503-8561, Japan
Tel: 0584-74-3355
IBIDEN Graphite Co., Ltd.
300, Aoyanagi-cho, Ogaki, Gifu 503-8503, Japan
Tel: 0584-89-6425
IBIDEN Industries Co., Ltd.
1-197, Uchiwara, Ogaki, Gifu 503-0936, Japan
Tel: 0584-89-0777
TAK Co., Ltd.
4-35-12, Kono, Ogaki, Gifu 503-0803, Japan
Tel: 0584-75-6501
IBIDEN Jushi Co., Ltd.
360, Shirotori, lkeda-cho, lbi-gun, Gifu 503-2413, Japan
Tel: 0585-45-2405
IBIDEN Bussan Co., Ltd.
339, Arisato, Motosu, Gifu 501-0415, Japan
Tel: 058-324-1151
IBIDEN Engineering Co., Ltd.
1122, Kido-cho, Ogaki, Gifu 503-0973, Japan
Tel: 0584-75-2301
IBIDEN CAREER TECHNO Corp.
300, Aoyanagi-cho, Ogaki, Gifu 503-8503, Japan
Tel: 0584-89-7435

Micro Mech, lnc.
33 Turnpike Road, Ipswich, MA 01938, U.S.A.
Tel: +1-978-356-2966

IBIDEN Electronics (Shanghai) Co., Ltd.
1/FA, Building 73, No. 17 Hancheng Road,
China (Shanghai) Pilot Free Trade Zone, Pudong,Shanghai, P.R.C.
Tel: +86-21-5046-5200

IBIDEN México, S.A. de C.V.
Av. América 100 Parque Industrial, Desarrollo
Logistik II Laguna de San Vicente Villa de Reyes,
San Luis Potos C.P. 79526
Tel: +52-444-834-8430

IBIDEN Asia Holdings Pte., Ltd.
31 Kaki Bukit Road 3 #06-22 Techlink Singapore 417818
Tel: +65-6296-0096

EUROPEIBIDEN Europe B.V. (Head office)Polarisavenue 85f 2132 JH Hoofddorp,
The Netherlands
Tel: +31-23-554-3180
IBIDEN Hungary Kft.
2336 Dunavarsany, Ipari Park, Neumann
Janos u.1, Hungary
Tel: +36-24-501-300
IBIDEN DPF France S.A.S.
24, Route de Joigny 45320 Courtenay, France
Tel: +33-2-3897-2650
IBIDEN Porzellanfabrik Frauenthal GmbH.
Gamserstrase 38, 8523 Frauental, Austria
Tel: +43-3462-2000

IBIDEN Singapore Pte. Ltd.
31 Kaki Bukit Road 3 #06-22 Techlink Singapore 417818
Tel: +65-6296-0096
IBIDEN Taiwan Co., Ltd.
8F-5, No. 366 Bóai 2nd Rd., Zuoying Dist., Kaohsiung City
81358, Taiwan
Tel: +886-7-550-8599
IBIDEN Graphite Korea Co., Ltd.
41, 75 South Road Yeongil Industrial Complex,
Heunghae-eup, Buk-gu, Pohang-si, Gyeongsangbuk-do,
37948, Korea
Tel: +82-54-271-3000
IBIDEN Korea Co., Ltd.
#1314, Hi Brand Bldg, 13F, 215, Yangiae-Dong,
Seoch-gu, Seoul, 137-924, Korea
Tel: +82-2-2155-3400
IBIDEN Philippines, Inc.
First Philippine Industrial Park Brgy.
Sta. Anastacia, Sto. Tomas, Batangas, Philippines
Tel: +63-43-405-5250
IBIDEN Electronics Malaysia Sdn. Bhd.
No. 1049, Jalan Perindustrian Bukit Minyak 8,
Kawasan Perindustrian Bukit Minyak
14100 Simpang Ampat, Penang, Malaysia
Tel: +60-4-504-9999

51

Corporate Information (As of March 31, 2016)

Corporate Data

Stock Information

Trade nameIBIDEN CO., LTD.

Fiscal year-end

Established

November 25, 1912

Annual meeting of shareholders

June

Capital¥64,152 million

Independent Auditors

Number of employees

Consolidated: 14,290

Ernst & Young 		
ShinNihon LLC

Domestic stock exchange listings

Tokyo, Nagoya

Date of record for dividend payout

Interim dividend: 		September 30

Non-consolidated: 3,614
PlantsHead office	2-1, Kanda-cho, Ogaki City,
Gifu 503-8604, JapanTokyo branch	Marunouchi Bldg. 29F,
2-4-1, Marunouchi, Chiyoda-ku,
Tokyo 100-6329, Japan
PlantsGifu Prefecture: Ogaki, Ogaki Central, 					
Aoyanagi, Gama,			
Ogaki-Kita, Godo

March 31

Year-end dividend:
March 31
Authorized shares

230,000,000

Shares issued and outstanding

140,860,557 (including
7,778,279 shares oftreasury stock)

Number of shareholders

32,391

		 Aichi Prefecture: Kinuura
Number of subsidiaries	Consolidated subsidiaries: 34(15 in Japan, 19 overseas)

52

Disclosure of Financial Information
IBIDEN takes steps to disclose information at appropriate times toshareholders and investors in a fair, accurate, and easy-to-understandmanner. Pursuant to the Timely Disclosure Rule of the Tokyo Stock

Website for shareholders and investors

http://www.ibiden.com/ir/index.html

Exchange, our information disclosure standards require the disclosureof information relevant to our operations, scope of business, andassets that could significantly affect investment judgments, as well as
any changes or suspension of important corporate information that has
already been published. Our policy is to disclose such information
proactively and fairly. We will also disclose corporate information that
could significantly influence investment judgments even if the Timely
Disclosure Rule does not apply, as accurately, promptly and appropriately as possible.

Top page of IR website

Principal Shareholders
Name of Shareholder
NORTHERN TRUST CO. (AVFC) RE SILCHESTER INTERNATIONALINVESTORS INTERNATIONAL VALUE EQUITY TRUST

Number of Shares (thousands)

Percentage

8,171

6.14

Toyota Industries Corporation

6,221

4.67

The Master Trust Bank of Japan, Ltd. (Trust Account)

5,045

3.79

NORTHERN TRUST CO. (AVFC) RE U.S. TAX EXEMPTEDPENSION FUNDS
OM 04 SSB Client Omnibus

4,796

3.60

4,627

3.48

The Juroku Bank, Ltd.

4,130

3.10

The Ogaki Kyoritsu Bank, Ltd.

4,120

3.10

Japan Trustee Services Bank, Ltd. (Trust Account)

3,477

2.61

IBIDEN Business Partners’ Shareholding Association

3,272

2.46

NORTHERN TRUST CO. (AVFC) SUB A/C NON TREATY

2,956

2.22

Note: The Company holds 7,778,279 shares of treasury stock, which is excluded from the major shareholders listed above.

Breakdown by Type of Shareholder
Japanese brokerage firms
1.2%
Treasury stock
5.5%

Breakdown by Size of Holding
Foreign corporations
37.1%

Other domestic
corporations
11.7%

100–999 4.1%

–99 0.1%

1,000–9,999 8.2%

1,000,000–
58.7%

10,000–99,999
6.6%

Individuals andothers18.7%

53

100,000–999,999
22.3%
Japanese financial
institutions
25.8%

Stock Price Range and Trading Volume (Common Stock)
Stock Price

Nikkei Stock Average (closing)

(¥)

(¥)

3,000

21,0002,000

14,000

1,000

7,000
Trading
Volume(Millions ofshares)

0

4
5
2014

6

7

8

9

10

11

12

1
2
2015

3

4

5

6

7

8

9

10

11

12

1
2
2016

3

50
40
30
20
10
0

www.ibiden.com